Oil prices extend gains and rig count shows a healthy growth

oil-rig-count


There is plenty of bad news on the Coronavirus front, especially in Europe, owing to the discovery of a new strain that has the potential to spread fast. 

The oil price, much to analysts' surprise, maintained the upward momentum, though, defying the gloomy news on the new infections.

Things may change slightly in the coming days as we enter the muted festive season. The oil price, however, will bounce back proving the critics wrong - once again.

In Western Europe where the lockdown measures are tough, there will be a decline in motor traffic - and air travel too - and it may reflect on the demand. As a result, the oil price will be affected to some extent in the coming weeks - something to be expected.

The fact of the matter, however, is that it is not something irreversible; nor has it reached the point of no-return. It's just an adjustment, due to the combination of seasonal impact and low traffic on roads.

The effect on oil price will gradually be eased in proportion to the progress on the vaccine front, as the latter determines the market sentiments. 

Moreover, the new strain of the virus has not led to an exponential increase in death despite the high infection rates.

We can only hope the virus will mutate into a milder form, as nature wants it to be, so that it can co-exist with us, the human beings, in order to fulfil its intended mission on the mankind in particular and nature in general.

 


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