This Week in The Lens
The Lens is FrontierView’s weekly newsletter published by our Global Economics and Scenarios team. Each week, The Lens features easily digestible content that dives into the business implications of macroeconomics on the market today.
Economic and geopolitical trends and insights from FrontierView’s Global Economics and Research team
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The seesaw of oil prices continues: after a seemingly unstoppable rally late in the summer that saw oil prices almost touch $100/barrel, the price of Brent crude has fallen back down to the low 80’s.
Oil traders are grumpy about the messaging being pushed by central banks, which is that interest rates will remain elevated for the foreseeable future, weighing on global growth and therefore oil demand. Supply concerns also seem to have been alleviated, thanks to strong production in the US, and the limited risk of spillover in the Israel-Hamas war. As recent evidence suggests, this all but guarantees further production cuts by OPEC, but the organization is mired in internal disagreements and was forced to postpone its meeting last week as a result.
Keep a close eye on oil prices in 2024. If they run much higher, central banks will start fretting about sticky inflation. If they fall much lower, consumer purchasing power will recover faster, while OPEC and Russia would find themselves stuck between a rock and a hard place. Either way, the seesaw is set to continue in 2024.
Analyst, Global Economics
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The Authors
Martina Bozadzhieva
Chief Research Officer
Antoine Bradley
Analyst, Global Economics