With the unprecedented surge in Coronavirus
infections in India, exacerbated by the lack of medical oxygen in hospitals and
the scarcity of beds, the oil price fell on Monday, having been subjected to
the inevitable volatility in the markets.
Making matters worse, the pandemic situation in
Japan also has become a serious cause for concern: some prefectures are in
lockdown, covering a quarter of the population, including the major cities such
as Tokyo and Osaka.
As the word’s third and fourth crude oil importers
struggle to cope with the new danger, markets sentiment has gone down
considerably: both WTI crude and Brent crude fell on Monday, reflecting the
evolving sentiments in the crude oil markets.
In addition, the anticipated increase in the output
by the OPEC+ in May must have played some role in the market sentiments too.
In India, meanwhile, there is a significant drop in
activities at the pumps; the prices of petrol and gas have not changed as
demand has plummeted.
As the oil price started going down due to the
pandemic, the wheat price has gone up steeply; oil investors, perhaps, may have
turned to yet another essential commodity at a time of a serious global health
emergency.
With regard to the global experience during the past
two waves of the pandemic, the positive sentiments do return to the markets in
dribs and drabs in proportion to the recovery that usually takes a couple of weeks;
crude oil price recovered even after going negative for the first time in
history.
Judging by the way authorities in Australia, Taiwan,
New Zealand and even China handled the crisis offers us hope at a time of
lingering anxiety that things could be turned around with the right leadership
combined with public corporation.
