• 3 minutes Is Pete Buttigieg emerging as the most likely challenger to Trump?
  • 5 minutes Can LNG Kill Oil?
  • 8 minutes Question: Why are oil futures so low through 2020?
  • 11 minutes Don't sneeze. Coronavirus is a threat to oil markets and global economies
  • 5 hours “The era of cheap & abundant energy is long gone. Money supply & debt have grown faster than real economy. Debt saturation is now a real risk, requiring a global scale reset.”"We are now in new era of expensive unconventional energy
  • 3 hours CoV-19: China, WHO, myth vs fact
  • 17 hours Question - What if there are no buyers for Chevron's Appalachia Assets?
  • 7 hours Blowout videos
  • 1 day OIL trades as if the virus is a 1 quarter event. As if it's Containable, Reversible and Temporary. Is it ?
  • 47 mins Democrats Plan "B" Bloomberg Implodes. Plan "C" = John Kerry ?
  • 13 hours Natural Gas
  • 1 day Energy from thin air?
  • 2 days Hey NYC - Mayor De Blasio declares you must say goodbye to fossil fuels. Get ready to freeze your Virtue Signaling butts off.
  • 2 days Foxconn cancelled the reopening of their mfg plants scheduled for tomorrow. Rescheduled to March 3rd. . . . if they're lucky.
  • 16 hours Cheap natural gas is making it very hard to go green
  • 5 hours US Shale: Technology
Alt Text

Three Innovations To Upend The Energy Storage Market

Batteries are often thought of…

Alt Text

The New ‘Must-Have’ For Energy Hedge Funds

Green investing is getting more…

Alt Text

The Complete Guide To Oxygenates

Oxygenates are chemical compounds such…

Editorial Dept

Editorial Dept

More Info

Premium Content

Will OPEC+ Cut Again? And Does It Matter If They Do?

As fears about the spread of the Wuhan coronavirus prompted selling in markets around the world last week, oil was one of the hardest hit. Earlier this week, however, when rumors were circulating about possible OPEC action to offset the fall, futures bounced. The question is, is it reasonable to expect action from the cartel and, perhaps more significantly, is that action needed?

If you stop and think about it logically, further production cuts based on the coronavirus outbreak would be absurd. This is a headline event that has caused a lot of completely unwarranted panic, and we have seen it all before. Whether it was SARS, MERS or Ebola, these outbreaks of scary diseases have become increasingly common of late. That in itself is cause for concern, but, like the others, this specific one will be history very soon.

It could be that over decades, the cumulative effect of these diseases will be to marginally depress global demand for oil, but that would simply mean very slightly slower growth than there would otherwise have been. That hardly justifies the kind of panic selling we have seen over the last week or two.

In context, however, it makes perfect sense.

Oil has been falling dramatically for a month now and in that environment, the impact of any bad news gets magnified. Even the risk of a big but temporary negative impact on demand becomes a major worry and prompts heavy selling. When you look at the chart though, it looks as though that selloff…




Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News