The dramatic decline in oil prices from a high of $150 per barrel in July 2008 to the $35-$45 range caught the world by surprise. In Latin America, a number of oil and gas producers had structured economic and political strategies on the supposition that extremely high oil prices were here to stay. The region"s subsequent failure to produce proportionately to its resource endowments may keep energy prices higher than necessary in the future, potentially dampening the global economic recovery when it begins.

The challenges raised by the weak energy and capital markets were the focus of a February 2009 conference at the Baker Institute, co-sponsored by the institute"s Energy Forum and Latin America Initiative as well as the Washington, D.C.-based Council of the Americas.