India’s coming oil drought

(From Bloomberg)

By David Fickling

Watching the development of India, there’s often an assumption the country will follow China’s path. For commodity exports,  China “is not the only game in town,” Australia’s resources minister Josh Frydenberg said in a speech last month, citing forecasts of India’s burgeoning demand for power, steel, and coal. Here’s one area where the two countries could scarcely be more different: oil. You might not think it looking back on a decade in which Brent crude prices have risen above $120 a barrel three times and sunk below $40 twice, but China’s growth has had a comparatively muted effect on global oil markets. While the country now accounts for about half of the world’s aluminum, copper and steel and coal.

Here’s one area where the two countries could scarcely be more different: oil.

You might not think it looking back on a decade in which Brent crude prices have risen above $120 a barrel three times and sunk below $40 twice, but China’s growth has had a comparatively muted effect on global oil markets. While the country now accounts for about half of the world’s aluminum, copper and steel production, its share of oil demand is a relatively modest 12 percent: Read more

oil

 



Categories: Asia Unhedged, China, India

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