Oil Shock and the Folly of Gaming Diversification

Main content

Collapsing oil with no bottom in sight is spilling into the financial markets. The magnitude and speed of the drop in oil prices suggests a steep supply and demand curve which means a little oversupply can send prices plummeting; but keep in mind it works both ways and the prices can reverse just as fast. No, we are not saying they will go back to the highs, but we are saying that oil prices could reverse quickly on any news that suggests a scaling back of production or a surprise increase in demand. Low oil prices have also been a positive price shock for consumers and manufacturers around the world especially in high consuming nations like the U.S. Markets reward investors not speculators and this too shall pass. Please see the Global Perspectives 2015 forecast that details the resilience and sustainability drivers in the markets.

Footer content