Nairametrics
  • Home
  • Exclusives
    • Financial Analysis
    • Corporate Stories
    • Interviews
    • Investigations
    • Metrics
  • Markets
    • Cryptos
    • Commodities
    • Equities
      • Dividends
      • Stock Market
    • Fixed Income
    • Market Views
    • Securities
  • Industries
    • Company News
    • Consumer Goods
    • Content Partners
    • Corporate deals
    • Corporate Press Releases
    • Energy
    • Entertainment
    • Financial Services
    • Hospitality & Travel
    • Manufacturing
    • Real Estate and Construction
    • Tech News
  • Economy
    • Get Data
    • Macro-Economic News
    • Research Analysis
  • Business News
  • Financial Literacy
    • Career tips
    • Personal Finance
  • Lifestyle
    • Billionaire Watch
    • Profiles
  • Opinions
    • Blurb
    • Op-Eds
No Result
View All Result
  • Home
  • Exclusives
    • Financial Analysis
    • Corporate Stories
    • Interviews
    • Investigations
    • Metrics
  • Markets
    • Cryptos
    • Commodities
    • Equities
      • Dividends
      • Stock Market
    • Fixed Income
    • Market Views
    • Securities
  • Industries
    • Company News
    • Consumer Goods
    • Content Partners
    • Corporate deals
    • Corporate Press Releases
    • Energy
    • Entertainment
    • Financial Services
    • Hospitality & Travel
    • Manufacturing
    • Real Estate and Construction
    • Tech News
  • Economy
    • Get Data
    • Macro-Economic News
    • Research Analysis
  • Business News
  • Financial Literacy
    • Career tips
    • Personal Finance
  • Lifestyle
    • Billionaire Watch
    • Profiles
  • Opinions
    • Blurb
    • Op-Eds
No Result
View All Result
Nairametrics
No Result
View All Result
Home Opinions

Oil cannot handle another wave of COVID-19

Opeoluwa Dapo-Thomas by Opeoluwa Dapo-Thomas
June 18, 2020
in Opinions
What is holding oil price?
Share on FacebookShare on TwitterShare on Linkedin

Early Monday morning, Brent Oil dropped to $37.24 as traders feared the second wave of the pandemic. This dip was significant compared to where prices were last week Monday ($43). Oversupply Concerns, sluggish demand, and a spike in Coronavirus cases were responsible for the sell-off.

As seen in the diagram above, a massive sell-off occurred after the weekend of the OPEC meeting on the backdrop of Saudi Arabia’s reaction to extending cuts further to August. With demand sluggish, refiners’ margins, and demand for jet fuel still struggling, Oil prices fell massively last week. It represented the worst week for Oil after its back to back rallies of previous weeks.

RelatedPosts

By the numbers: Comparing NNPC with Saudi Aramco

Two decisions Buhari needs to make to rescue his failing economic legacy

Little wonder, the Group Managing Director of Nigeria National Petroleum Corporation, Mele Kyari labelled the high rise to $43 as “cosmetic.” In his words,

“The recent drive we have seen in the price of crude is largely driven by sentiments than demand because we have not seen the significant rise in the demand. There is no 100% conformity with the cut, and that means that the volume is still there. The price jump appears cosmetic to me, and if we don’t contain the supply, we could slide to the early March price level.”

Cosmetic is just the right word. The virus has not been eliminated. A lot of other geopolitical issues have masked it or instead made people sweep COVID-19 under the carpet. But it still looms in the air. The pandemic is still at large. Countries have eased lockdown for the sake of the economy and not because the virus has been largely controlled. This imbroglio explains why at the tail end of last week, there was a massive sell-off in Wall Street and in the Oil markets as fears gripped traders on the second wave of pandemic-hitting cities.

Reports also show an increase in cases in Beijing and towns in the United States of America. It was reported that one of China’s most extensive supply centres for fruits and vegetables had been shut down last weekend after scores of people working in and with market-tested positive for COVID-19. In the United States, the Federal Reserve warned about the detrimental damage the virus would have on the economy and showed sharp increases in cases, especially in Florida.

If cases soar in China and the United States, then the global economy is in for a cataclysmic shock. China is the leading light; the Oil markets look up to. If China shows signs of inability to contain the virus, then Oil would not find the support to spur on. Oil cannot handle another wave of Coronavirus. The recovery in China’s economy is not as fast as perceived weeks ago. Albeit the significant improvement in factory output, consumer spending, and investments, the recovery needs more push, and a second coming of the virus is not one of it.

With the U.S. Food and Drug Administration (FDA) revoking the emergency use authorization for Chloroquine and Hydroxychloroquine, and vaccines still a far-away panacea, COVID-19 would even limit demand more which is needed for the recovery of oil prices.  Oil can certainly not afford another wave.

 

 

 

 

 

 

 

 

 

 

 

 

 

.

 

Related

Tags: America and Chinacrude oilMele KyariOPECUS

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Hot forex
Cornerstone
Mega Millions
Polaris Bank
Access Bank
Bankers Committee
First bank


FCMB
Ikeja Electrics




    Business News | Stock Market | Money Market | Cryptos | Financial Literacy | SME |

    Recent News

    • With a smile or a wave, paying in store just got personal
    • U.S wants TikTok removed from Apple, Google app stores over data concerns
    • Sky Mavis opens Ronin bridge after $625 million hack

    Follow us on social media:

    Recent News

    Covid-19: Mastercard says fuel spending higher in Nigeria compared to 2018 peak, as economy reopens

    With a smile or a wave, paying in store just got personal

    June 29, 2022
    TikTok reaches one billion monthly active users worldwide

    U.S wants TikTok removed from Apple, Google app stores over data concerns

    June 29, 2022
    • ABOUT US
    • CONTACT US
    • PRODUCTS
    • ANDROID APP
    • iOS APP
    • DISCLAIMER
    • CAREERS
    • PRIVACY POLICY

    © 2022 Nairametrics

    No Result
    View All Result
    • Home
    • Exclusives
      • Financial Analysis
      • Corporate Stories
      • Interviews
      • Investigations
      • Metrics
    • Markets
      • Cryptos
      • Commodities
      • Equities
        • Dividends
        • Stock Market
      • Fixed Income
      • Market Views
      • Securities
    • Industries
      • Company News
      • Consumer Goods
      • Content Partners
      • Corporate deals
      • Corporate Press Releases
      • Energy
      • Entertainment
      • Financial Services
      • Hospitality & Travel
      • Manufacturing
      • Real Estate and Construction
      • Tech News
    • Economy
      • Get Data
      • Macro-Economic News
      • Research Analysis
    • Business News
    • Financial Literacy
      • Career tips
      • Personal Finance
    • Lifestyle
      • Billionaire Watch
      • Profiles
    • Opinions
      • Blurb
      • Op-Eds

    © 2022 Nairametrics

    Social Media Auto Publish Powered By : XYZScripts.com