Away from the devastation and suffering of the US Gulf coast, the main impact of Hurricane Katrina has been on oil and petrol prices. Crude touched an all time high of $70 a barrel and now hovers around $67, while the extra premium for refined petrol has shot up. Investors would be wise to ponder what this means for the world ­economy.

If anyone had said back in January 2003 that the price of oil could increase from $30 to $70 without severe economic consequences they would have been dismissed as insane. Yet this is what has happened. The question is, should we assume that because the world economy has shrugged off high oil prices to date it will continue to do so in the future? Answer: No.