Goldman Sachs' chief commodity researcher has painted a positive picture for oil trade despite the ongoing trade dispute between China and the US.
With everything else succumbing to the tariffs being imposed on products coming from the world's two biggest economies, it's only natural that people are pessimistic. The US crude was actually experiencing a seven-week low, $67 a barrel in its latest forecast. This was due to China's retaliatory tariffs it imposed in response to the US tariffs.
Jeff Currie, the chief commodity researcher, remains optimistic. Yahoo Finance reports that his forecast remained at $70 a barrel for this year. He cited factors like global economic growth, among others, and even cited multiple clients, which is why oil prices wouldn't be affected as much.
This is why, just like in other goods, other countries like India, for instance, may gain just a bit from what is happening between China and the US, India Times says.
China has been the largest US crude and gas buyer in Asia prior to the dispute. However, with the situation, Beijing is currently looking for other sources. For the time being, it's continued buying from Tehran, making Iran oil experience a surge. China's loss may become, after all, India's gain.
India is a big consumer of US oil, to the tune of 9.94 million barrels of crude. About 319,000 barrels per day, to be exact. With this much acquisition, India may actually turn out to be the US' prime trading partner. It could ask for a waiver of understanding between countries, making it second only to South Korea in the importation of US oil.
With the situation being what it is with China, it could actually work. However, the forecast still says that, in the case of oil, there's really no clear winners and losers if it is included in the greater US-China trade war.
With oil, as Currie explained, there are so many countries dependent on it; there are a lot of sources where oil comes from, and there's always a demand from the next available country. That's why oil prices are moved as a global unit and not per country.
China and the US may have problems in other sectors of industry, but in the case of oil, the prices and the market is still exactly where it needs to be.
