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Europe is nearing a recession, and the U.S. may be right on its heels, the world’s second-largest container carrier told Bloomberg TV on Wednesday.
Recession fears have put a cap on oil prices as analysts mull just how deeply a recession would cut into the demand for the commodity that is stealing the political limelight in Russia, OPEC countries, and the United States.
And A.P. Moller-Maersk A/S—which controls one-sixth of the world’s container trade—sees global trade slowing between 2% and 4% in a stark warning for not just the container industry but the oil and gas industry as well. A recession, according to Moller-Maersk, is a near certainty in Europe, thanks in no small part to the war in Ukraine and the looming energy crisis.
“It’s really hard to be very optimistic with a war on our doorstep and a bigger energy crisis this winter so that is impacting consumer confidence and therefore also demand,” Maersk CEO Soren Skou said in an interview on Bloomberg Television, adding that global trade was moving backward.
“It’s quite likely that we either are or will soon be in a recession, certainly in Europe but potentially also in the US.”
Moller-Maersk’s share prices dropped in early trading on the publication of the gloomy forecast that sees “plenty of dark clouds on the horizon,” its Q3 earnings report read.
Moller-Maersk sees the global container market broadly flat to negative next year, skewed to the downside. “We will see where this lands or normalizes.”
Maersk’s Q3 EBITA rose to $9.48 billion, beating analyst estimates.
The crude oil market has been nervous about a recession, keeping a lid on oil prices even after OPEC cut its production targets by 2 million bpd, which begins today.
By Julianne Geiger for Oilprice.com
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Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group.