Will Iraq derail the global economic recovery? The latest iteration of the country’s seemingly endless conflict has already started to squeeze oil prices higher. The question now facing investors is how much of an oil shock would it take to stall what looks to be a widespread–if still very subdued–recovery from the financial crisis of 2008. The price of West Texas Intermediate crude oil has risen 17% over the past six months to $107.12 a barrel–with a 5.4% gain coming just in the past week. That’s well short of a shock. But in the past, strong prices rises have proved a hazard to economies, which would make yet further increases alarming. “The correlation between oil shocks and economic recessions appears to be too strong to be just a coincidence,” wrote James Hamilton , an economics professor at the University of Southern California, San Diego, in […]