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Increased fear of viruses weighs on markets around the world on Friday, after a new and more contagious coronary variant was discovered in South Africa.
After a sharp decline in both the Asian and European stock markets, the market is in turmoil spread to Wall Street. On the Oslo Stock Exchange, it was the worst day of the year so far, when the main index ended the day a decrease of 3.2 percent.
The price of oil has fallen significantly throughout the day, and the fall increases throughout the afternoon. Just before 5 pm on Friday afternoon, the North Sea oil burnt, which is used as a reference for oil trading worldwide, falls more than ten percent and is traded at just over 74 dollars a barrel. This is the lowest level since September.
The Norwegian krone is dragged down in the fall and has weakened sharply against both the euro and the dollar throughout the day. On Friday afternoon, the euro costs NOK 10.28, compared with NOK 10.05 on Thursday. The dollar is traded for 9.09 kroner.
Viruses cause trouble
Commodity analyst Bjarne Schieldrop in SEB Commodities believes that the fear of the new virus has a direct effect on oil prices.
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– We see the contours of the fact that we were not on the other side anyway. It is not the right path to global opening. We are facing a winter with trouble, mutations and more infection, and thus less travel. Then there will be weaker oil demand – and that weighs on the oil price, he says to DN on Friday night.
Chief economist Frank Jullum at Danske Bank believes the market was taken aback by the news of the South African variant.
– The players who have positioned themselves in the stock and foreign exchange market have not taken so much into account that there will be negative corona news, so it means that the effects will be greater than usual. It will be a little more shock now, in that it has been a long time since you have had such big negative news, he told DN earlier Friday.
Commodity analyst Bjarne Schieldrop in SEB Commodities. (Photo: Hanna Kristin Hjardar)
Biden effect
Earlier this week, US President Joe Biden announced that the US would release 50 million barrels of oil from the country’s strategic oil reserves. The purpose is to lower rising fuel prices in the United States. Britain, India and China did the same.
Schieldrop believes this has helped to strengthen the virus effect on oil prices.
– The market was satisfied, it was not so bad with the strategic stocks. But together with the risk of weaker demand, it helps to strengthen the effect, he says.
Schieldrop is excited about what the OPEC countries will do when they meet next week: The question is whether they will hold back or will they increase production.
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– What are the prospects for the oil price going forward?
– It depends on the virus. Now there’s a fear that it’s serious, but we do not know. So now you sit for a while and wait. But what we do know is that we have a long winter ahead of us. Some countries have already shut down. In Norway and Denmark, hospitals are struggling, and then the restrictions are often just around the corner, says Schieldrop.(Terms)Copyright Dagens Næringsliv AS and / or our suppliers. We would like you to share our cases using a link, which leads directly to our pages. Copying or other use of all or part of the content may only take place with written permission or as permitted by law. For additional terms look here.
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:quality(80)/cdn-kiosk-api.telegraaf.nl/029847e4-4ebb-11ec-895c-02c309bc01c1.jpg "New South African corona variant appeared in Belgium, concerns among experts Abroad")
