In our December oil price outlook, we highlighted two factors that dominated the oil market during the course of 2011. Firstly, repeated production outages in the North Sea, West Africa and elsewhere, coupled with the Libyan civil war, resulted in serious supply tightness. Secondly, demand remained resilient despite a deteriorating macro-economic environment. We expect these… [Read more]
Libyan rebels appear to have taken control of the capital Tripoli. However, Business Monitor’s Head of Political Risk Yoel Sano cautions against premature optimism. While stability remains far from assured at the present juncture, we also speak with Saket Vemprala, Oil & Gas analyst, about the outlook for the all-important energy sector and when Libyan… [Read more]
Our bearish stance towards oil continues to play out, with Brent crude getting pummelled following the International Energy Agency (IEA)’s June 23 announcement that it would release two million barrels of oil per day over the next two months from its strategic reserves. Despite a massive 9.4% decline over the last two weeks, we continue… [Read more]
Weak US economic data, renewed crisis fears in the eurozone and ample supply conditions have taken a heavy toll on the price of oil over the week June 13-17, with front-month Brent crude posting a 4.8% drop (at the time of writing) from the US$118.46/bbl level at which it started the week. While a short-term… [Read more]
Brent crude made an upward surge on February 24, hitting a new post-financial crisis high of US$119.79/bbl, as Colonel Muammar al-Qadhafi lost control of vast swathes of oil-producing Libya to pro-democracy protesters. However, my colleagues and I are not convinced that oil will continue to sky-rocket and hit new all-time highs. Instead we see consolidation… [Read more]
Following a rally in Middle Eastern equity markets, driven by hikes in oil prices and the Dubai World’s debt restructuring, several bourses are up against key technical resistance. With momentum indicators, such as the Relative Strength Index (RSI) looking firmly overbought, I believe that a near-term correction is increasingly likely in Dubai, Saudi and Qatari… [Read more]
Industrial commodities such as energy and base metals are highly correlated to risk appetite and hence equity markets. Below I highlight the monthly rolling correlation between Brent crude and the Dow Jones. The two main things to note are that first, on a monthly basis, the correlation stands at 0.9 (which implies a strong and… [Read more]
