Oil is a curse. Natural gas, copper and diamonds are also bad for a country's health. Hence, an insight that is as powerful as it is counterintuitive: poor but resource-rich countries tend to be underdeveloped not despite their hydrocarbon and mineral riches but because of their resource wealth. One way or another, oil – or gold or zinc – makes you poor. This fact is hard to believe, and exceptions such as Norway and the US are often used to argue that oil and prosperity for all can indeed go together.

The rarity of such exceptions, however, not only confirms the rule, but shows what it takes to avoid the misery-inducing consequences of wealth based on natural resources: democracy, transparency and effective public institutions that are responsive to citizens. These are important preconditions for more technical aspects of the recipe, including the need to maintain macroeconomic stability, manage public finances prudently, invest part of the windfall abroad, set up “rainy-day funds”, diversify the economy and ensure the local currency does not reach too high a price.

It all sounds sensible, and with Brazil, Ghana and others soon likely to become big oil players, we can expect to witness some rare test cases of these recommendations.