Oil Prices continues to slide as Coronavirus fear spreads

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Biznextindia : International oil prices has continued to slide in Tuesday as the panic due to the coronavirus has expanded to other geographies in the World. The benchmark Brent Crude is remain below the USD 60 mark at USD 58 per barrel. Similarly, WTI Crude has dropped slightly to USD 53.18 per barrel.

In mainland China, the death toll due to the Coronavirus outbreak has reached to 106, with more than 1771 new confirmed cases has been added on Monday taking the total number of confirmed cases to 4515. The death toll is feared to rise drastically as more than 976 patients are in critical condition, the Chinese National Health Commission said.

Oil Price Outlook : 

Despite temporary pressures on the prices owing to the outbreak of Coronavirus, international oil prices will remain range bound between USD 62 to 67 in the next few months.

“We believe the price of Brent crude oil will be range bound between USD 62-67/bbl in the coming few months. The Outbreak of the corona virus is to contain the prices of oil for a while. US production is to rise as the current US government has vested interest in keeping the oil prices low since next year is election year.” said Care Ratings.

However, CARE Ratings has said that India’s dependency on oil imports will continue to rise beyond the current levels of 83.3%.

“Domestic production of crude oil will further fall by 2.5% and be around 244.5 million barrels during FY20. Domestic crude oil production during FY19 was 251 million barrels. Processing of crude oil is to rise by 3.7% to 1956 million barrels which will lead to crude oil imports increasing by 3% to 1711 million barrels during FY20. Import dependency to increase as well from the current 83.3%” it said.

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