17 June 2019 : One would have expected Brent Crude to shoot higher as geopolitical tensions in the Middle East trigger concerns over potential supply risks making a return.

However, Brent Crude is wobbling above $62 at time of writing, even as OPEC continues to stoke market confidence that the ongoing supply cuts will be extended through 2019. It is becoming clear that investors are overlooking geopolitics to focus on demand side factors in the form of slowing global growth and persistent trade tensions. With the International Energy Agency’s forecasting that supply will outgrow demand in 2020, the path of least resistance for oil points south, even as OPEC+ producers attempt to rebalance markets in an effort to limit downside shocks.

Falling Oil prices will hit many energy export dependent nations including Nigeria. Should WTI & Brent Crude remain in a bear market, this will eat into Nigeria’s government revenues, threaten foreign exchange stability and most importantly economic growth.

Reporting for EasyKobo on Monday , 17 June 2019 in Lagos, Nigeria

Source: Lukman Otunuga, FXTM Research Analyst