Stock market: Experts warn of a looming recession
The set of alarm bells and General geopolitical uncertainties have a lot of pressure on the world oil market. Despite the fact that OPEC countries are trying to do everything possible to stabilize the situation with oil, fears of a slowdown in economic growth is still there, and they provoke a decrease in demand for energy.
For the first time since 2007, there was an inversion of the yield of two-year and ten-year U.S. Treasury bonds that talks about the impending recession. Against this background, the participants can determine the direction and for the most part are out of the market to minimize risks.
On the other hand, the weak industrial production in China creates a threat of falling oil demand from the major importer. The pressure on the black gold had published data from the news Agency of energy of the USA (EIA) – they were better than the expectations.
Based on common factors of influence, OPEC countries will be difficult to maintain the stability of the global oil market. This can lead to the fact that a large proportion will be transferred to the USA, with quality in a price equivalent to the OPEC countries will fail to achieve in full. In such a situation to cut oil production should have a minimum of 2 million barrels per day.
Iran and Venezuela will not participate in the Covenant, so Saudi Arabia can take on the lion’s share of cuts in production. How this will help global oil market, is difficult to answer. Given the impending recession and possible collapse of the stock markets, it’s better to wait out this negative point and then to take action.
If everything will remain the same, the oil market will not be likely to expect growth. It is now important to prevent a sharp fall in oil prices and keep market stability. Brent may decline to $58,25 per barrel, and WTI will trade at $55,00.
“International financial center”