Citi expects oil prices to stay weak in H1 2020 before finally recovering toward year-end
A client note from Citi (via Bloomberg) related to oil impacts from the coronavirus outbreak.
It begins by saying markets are overconfident by looking for a sharp recovery (V-shaped) in markets impacted by the coronavirus
- Citi look for a weaker "U" shaped recovery in physical markets, "W" shaped(or a series of Ws) for financial markets (bonds, equities and commodities)
- Notes China stimulus efforts but says supply-chain recovery is problematic, as is weak demand in China
- On oil specifically, weak China demand poses problems for imports from the US