“Overall, we don’t think the global economy is on the verge of a sudden downturn,” said Amrita Sen, director of research at Energy Aspects, noting that disappointing Chinese growth and signs of a slowdown in the United States have made policymakers in both countries hesitant.
“I don’t think what we saw on Monday was a one-off event,” Sen said at the Reuters Global Markets Forum, referring to a massive sell-off earlier this week that was triggered by a decline in yen-funded trades.
“We’re likely to see a few more rounds of total collapse, but the fundamentals of oil are stable,” she added.
Global stocks extended gains on Friday, erasing nearly all of their losses from this week’s sell-off.
Energy Aspects expects oil demand in 2024 to grow by more than 1 million barrels per day compared to last year, which Sen said is a rate similar to global slowdowns in previous years.
In the near term, the market will remain focused on demand that will not “recover” due to the weakness of the Chinese economy, Sen said.
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