WASHINGTON, April 8 (UPI) -- High oil prices are here to stay and governments should race toward renewables but the long-term impact on economic growth will be minor, the IMF said.
Economists at the International Monetary Fund said demand from emerging economies is catching up with supplies just as many major oil fields reach maturity.
Oil, the IMF said, is the dominant energy source, accounting for around 33 percent of the total energy mix. Coal and natural gas account for a bulk of energy supplies, leaving renewable energy a minor player in the global energy mix.
The IMF report is consistent with a report from the International Energy Agency that said despite "impressive" gains in clean energy, fossil fuels are the dominant energy source in the world.
The IMF said an oil shock could create instability in the global market and policy makers should move quickly to develop sustainable energy policies.
Nevertheless, economists said oil scarcity won't have a major impact on medium- to long-term economic growth.
"Our simulation analysis shows that gradual and moderate increases in oil scarcity, consistent with supply projections by others, may only be a minor constraint on global growth in the medium to long term," the IMF economists said.