FXTM information and reviews
FXTM
95%
OctaFX information and reviews
OctaFX
94%
XM information and reviews
XM
93%
FXCC information and reviews
FXCC
92%
Libertex information and reviews
Libertex
91%
FxPro information and reviews
FxPro
90%

Oil to suffer long term


1 June 2020

The oil price is down more than 1 percent in today’s trading session as the market digested the news on bigger than expected oil inventories in the US which raised concerns that demand was starting to slide.

The U.S. Energy Information Administration (EIA) released figures showing that crude oil inventories rose 7.9 million barrels over the last week, well above analyst’s expectations which was attributed to a big increase in imports. Some say the extra inventories are justified because gasoline demand is picking up as the US population begins driving again and lockdown measures regarding the coronavirus are eased. 

“Even though we got the big increase in crude supplies, there’s optimism in the numbers because of the uptick in refinery runs and because of the uptick in gasoline demand,” said Phil Flynn, senior analyst at Price Futures Group in Chicago.

The coronavirus epidemic has caused long lasting misery and financial pain to all sectors of the economy and one of the worst casualties was the oil price which just over a month ago fell into negative territory before staging a sizeable comeback and is currently trading at over $30 per barrel.

However, the long-term damage may already be done as the world’s population rearrange their daily working lives which is going to have a huge impact on the oil price going forward.

One of the biggest threats to oil demand is the current trend of working remotely which was forced on most of the world’s population due to the coronavirus. This may become the new norm for many as businesses seek to cut costs by saving on rent for office space which means less travelling by car or by plane which will have a huge impact on oil.

“Pretty much every company out there with a sizable commercial real estate footprint is thinking about this now,” said Dan Klein, head of scenario planning at S&P Global Platts. “While it’s probably too early to tell how prevalent this structural shift in working from home will become after the restrictions are lifted, it’s clear that a certain percentage of workers will never go back to commuting, at least every day,” he added.

#source

Share:


Related

Forex and Cryptocurrencies Forecast for September 26-30, 2022
Forex and Cryptocurrencies Forecast for September 26-30, 2022

Last week, all the attention of the markets was focused on the FOMC meeting of the US Federal Reserve, which took place on September 21. The probability of another rate hike by 75 basis points (bp)...

26 Sep 2022

Trading the SPDR S&P 500 ETF Trust
Trading the SPDR S&P 500 ETF Trust

The Standard & Poor’s (S&P) 500 Index measures the market capitalisation of the top 500 US largest corporations. Many traders and investors use the S&P 500 Index as a benchmark...

23 Sep 2022

Gold pauses as traders await Fed decision
Gold pauses as traders await Fed decision

The anticlimactic performance of gold continues as the prospect of aggressive rate hikes by central banks around the world amid heightened inflationary pressures...

21 Sep 2022

Developing a forex trading plan: All you need to know
Developing a forex trading plan: All you need to know

All forex traders have different backgrounds, market views, risk appetite, thought processes and expectations. Therefore, traders should not just blindly follow what other traders do...

20 Sep 2022

NordFX: Forex and Cryptocurrencies Forecast for September 19-23, 2022
NordFX: Forex and Cryptocurrencies Forecast for September 19-23, 2022

The World Bank said last week that risks of a recession in 2023 are growing amid simultaneous tightening of monetary policy by the world's leading Central banks and the energy crisis in Europe...

19 Sep 2022

Gold gains traction on the back of weaker dollar
Gold gains traction on the back of weaker dollar

The precious’ recent rally from its near year-to-date lows could be attributed to the broader dollar weakness observed in the past week, even though it remains elevated near its 20-year highs...

14 Sep 2022


Editors' Picks

HFM information and reviews
HFM
89%
IronFX information and reviews
IronFX
88%
FXCM information and reviews
FXCM
87%
NordFX information and reviews
NordFX
85%
Vantage information and reviews
Vantage
84%
FP Markets information and reviews
FP Markets
81%

© 2006-2022 Forex-Ratings.com

The usage of this website constitutes acceptance of the following legal information.
Any contracts of financial instruments offered to conclude bear high risks and may result in the full loss of the deposited funds. Prior to making transactions one should get acquainted with the risks to which they relate. All the information featured on the website (reviews, brokers' news, comments, analysis, quotes, forecasts or other information materials provided by Forex Ratings, as well as information provided by the partners), including graphical information about the forex companies, brokers and dealing desks, is intended solely for informational purposes, is not a means of advertising them, and doesn't imply direct instructions for investing. Forex Ratings shall not be liable for any loss, including unlimited loss of funds, which may arise directly or indirectly from the usage of this information. The editorial staff of the website does not bear any responsibility whatsoever for the content of the comments or reviews made by the site users about the forex companies. The entire responsibility for the contents rests with the commentators. Reprint of the materials is available only with the permission of the editorial staff.
We use cookies to improve your experience and to make your stay with us more comfortable. By using Forex-Ratings.com website you agree to the cookies policy.