Oil Prices Plummet as China’s Economy and Commodity Markets Fall

Oil Prices Plummet as China’s Economy and Commodity Markets Fall


Today is Tuesday 12th January 2016 and we
are briefly covering the issue of the recent Slump in oil prices.
Brent crude prices fell by more than 3 per cent to $30.43 a barrel today, extending losses
over the first seven trading sessions of 2016 to 17.3%. At the time of this video it stands
at $30.96 down 1.8% and extends a nearly 7% drop from Monday. Reasons given for this fall
ranges from: too much supply, the weakening Chinese economy, sliding stock markets, and
a strong dollar, which makes it more expensive for those using other currencies to buy oil.
Initially, prices started to rise when traders said support came after Nigeria’s oil minister
commented that a “couple” of OPEC members had requested an emergency meeting. But buying
faded after the United Arab Emirates oil minister said that the current OPEC strategy was working
and the first six months of 2016 would be tough but there would be a gradual recovery
in the oil market; so traders decided to focus on the global supply glut instead.
Saudi Arabia, which sits on large cash reserves, has insisted it will not cut production unless
non-OPEC members such as Russia also lower output. Growing tensions with Iran have all
but killed off the possibility of Saudi Arabia changing course, with Tehran preparing to
raise exports once western sanctions linked to its nuclear programme are lifted. Other
OPEC members have said an emergency meeting is unlikely.
Concern about slowing demand growth and market positioning has prompted analysts to lower
their price forecasts. Barclays became the latest investment bank to revise its estimates
predicting an average price for Brent and WTI in 2016 of $37 a barrel against previous
forecasts of $60 and $56, respectively. “Although we still expect higher oil prices
over the second half of 2016, we see prices moving up from a lower base than we previously
envisaged and on a much shallower gradient,” the bank said.
Morgan Stanley analysts have stated that “oil in the $20’s” is possible if China further
devalues its currency and economists at the Royal Bank of Scotland predict that it could
slump to $16 with Standard Chartered Bank being the most bearish of all predicting a
crash down to $10 a barrel. There is no doubt that the short term outlook
for the oil market is bleak. With production creating a surplus of some 1 million barrels
a day, plus decelerating demand and OECD inventory levels at an all-time highs (so much so, that
storage is rapidly becoming a major concern), lower prices seem all but inevitable. Whilst
North Sea Oil producers can weather the storm currently and a number (but reducing number)
of US Shale oil producers can also survive this onslaught for the time being by increasing
supplies to pay off debt interest, countries such as Venezuela, Algeria and Nigeria are
facing severe financial difficulties together with political unrest as the result of rapidly
growing unemployment. Like most commodities currently the trend
is certainly lower and we foresee this also continuing in the gold and particularly in
the silver market during the first half of 2016.
Since the start of the week Silver is down some 12 cents from $13.94 – $13.82 and gold
is down s$15 from $1104 – $1089 We hope you have found this video interesting
and informative and if so, please give it a thumb up and share it on twitter. Also kindly
visit our website regularly at www.illuminatisilver.com Disclaimer: Illuminati Silver owners come from a background
of Banking, International Wealth Management and Economics. Having now retired from these
worlds we are not qualified to give investment advice. Therefore, this and other productions
must not be deemed to be giving such advice and merely represent the personal views of
its owners.

27 Comments

  1. Oil is just as manipulated as Silver. Iran and Russia's economy must be destroyed, as they are standing in the way of the diabolical "Greater Israel" project. Europe must be destroyed too, by mass invasion of the people displaced by the "Greater Israel" project leaving "Greater Israel" a world power.

  2. Dipped below 30 in U.S for a moment….. Guess we are waiting for March for a meeting on the matter. ( waiting on March ) I wonder if I am right on 1079 to 1015. Only time will tell as they say. Thanks for the video. Take it easy.

  3. BP announce 4000 job loses, Russia to start selling oil in Rubles, Iran may sell in Rubles if sanctions are not lifted. Saudi may offer IPO on Saudi Aramco it would have to be sold off in very small pieces its to big! Aramco should of been sold 3 years ago if they were to sell I don't think they will sell now when oil is so cheap makes no sense.

  4. Remember Gold and copper or gold and zinc producers will chase the lower price down.mines have a finite cut off price determined by the current spot price and inputs if their inputs are going down that raises their cut off price. So in some instances mines will be able to continue to operate even though the gold price has dropped precipitously.

  5. It's just a shame that the price isn't passed onto consumers by BP and others. A BP petrol station near me has had Unleaded and diesel at 104.9p/litre all the way from $40 to $30!

  6. I remember gas almost got to 5.00 a gal at its highest seems like that price was Manipulated now that i look back looking at 30 something dollar a barrel . in calif they always have a processing plant down for service and winter blend verses summer blend . all friggin manipulated price for gas ……The biggest joke is supreme gas most cars don't run any better even if the mfg says to use it ……

  7. If gasoline is supposed to go down in price by 25 cents, it takes several days if not weeks. If it's supposed to go up in price by 25 cents, it takes nanoseconds. It's a scam.

  8. RBS has announced it has advised customers to dump shares, save bonds ahead of an expected contraction in the markets. They expect a market correction of 10 – 20%. Following falling oil prices and turmoil in China they think a market correction will happen sooner than expected. SM

  9. Someone, please, help me understand this. If we are in a deflationary time, why has the price of food and rent gone up 20 to 25% in last few few hrs.

  10. oil broke $30 a barrel yesterday…stocks down another 350 points today…IMHO..we are in a DEFLATIONARY CRISIS…and it will really take hold in 2016 -2017…batten down the hatches…CASH IS KING.. I think when its hits hard on gold/silver , in this next down cycle , that will be a great time to load up on metals…and then hold for 10 + years to see nice profits. Gold and silver should be skyrocketing right now…and the fact that it isnt..is a VERY bearish sign for what is to come for metals.

  11. Harry Dent…has been the " man" ..so far…Id advise everyone to research this guys predictions…hes so good, its scary.

  12. I will ignore any fool that claims metals has to soon skyrocket, because of :
    1. short supply
    2. high demand
    3. rising miners costs

  13. Harry dent was predicting DOW 6500…he has now downgraded that to DOW 5000- 6000…I personally will be shocked to see that happen…but its tough to doubt someone like harry, who has been spot on with his other predictions.

  14. I would imagine that if these triple digit sell offs continue much longer in the DOW, that sooner or later, we are gonna see thousand point selloffs per day……and that will happen when the billionaire investors decide to dump stocks due to constant triple digit losses per day…ITS COMING ! I see this market has being a market that you dont buy on the dips, you SELL what you have, on the spikes…just so you can cut your losses and have cash on the sidelines.

  15. China was just a Paper Tiger. Look at how their people act in a civilization of rules. They cut lines, they act rude and disrespectful, and misbehave in public. They drive crazy to get places, and break laws. That has been their economic advantage in short term. When everyone starts running over people and breaking rules learned by centuries of mistakes, as if they discovered a magic secret, then everyone hacks at one another and nobody wins. "Spend money to make money, be generous to loyal people who help your business succeed, (not keep them at minimum wage)" and other traditions that made businesses stable, were built from a pile of wisdom. Then a bunch of short sided Harbingers, who sell off aggressive lawlessness as hard work, enter the scene with a Communist government.

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