1974 ended as it had begun, in an atmosphere of crisis for the world economy. But while inflation remained at or near the forefront of official preoccupations, in other respects the nature of the crisis had been changing gradually as the year progressed. Initially it had seemed that the main obstacles to a normal rate of expansion of output and trade would be shortage of energy and highly unstable conditions in the international currency markets. In practice, however, the vast funds now at the disposal of the oil-producing countries have not so far proved to be particularly volatile and except in the early part of the year the level of petroleum output that they have been prepared to allow has exceeded the importing countries' requirements. Moreover, the weakness of effective demand for oil has been due less to direct measures of energy conservation than to general economic depression throughout the year at a level of output, for the OECD area as a whole, which on average was some 1 1/2 per cent below the rate achieved by the fourth quarter of 1973. This situation seems certain to persist well into 1975 and to bring with it levels of unemployment which, by post-war standards, will be exceptionally high, as well as an initially declining volume of international trade.