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DAS INVESTMENTSavings banks and banks1 MIN READING TIME2018-01-12

Metzler analysis: "The oil market is ripe for a correction"

After the sharp rise in prices in recent months, oil prices could soon plummet again, analysts from the Frankfurt bank Metzler believe.

"After the strong one-way traffic of the past just under seven months, in which Brent oil was able to gain more than 57%, the market is now actually ripe for a correction," comment analysts from the Frankfurt bank Metzler the recent record oil prices. And that's a good thing: a sharp rise in oil prices is not conducive to the global economy and the development of inflation, the analysts said.

Not only could the declining coverage of global chaos scenarios - such as riots in Iran or the recent cold snap in the USA, however - be reflected in price dampening, believes Metzler expert David Varga. Another factor could calm the oil price - the current extreme long positioning of commodity speculators, Varga said.

Even the OPEC states would expect a price increase of the raw material to more than 60 US dollars, the Metzler analysts suspect. Because the producing states would be happy then in the short term over higher revenue for their public funds. On the other hand, they could lose market share to the US shale oil producers in the medium to long term. Because these are obviously already in the starting blocks to expand their own flow rates at attractive prices. Production estimates by the US Department of Energy point to corresponding plans by US oil producers, according to the Metzler analysis.

The price of oil reached another record high yesterday, Thursday: the Brent variety just scratched the $ 70 mark. The variety WTI climbed to around 65 US dollars per barrel. Thus, prices were even slightly higher than at the last high-time of the oil price in May / June 2015.

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