WTI

#WTI prices saw very little movement after OPEC+ announced their highest production cut ever. The 6 week average price of crude is now below US$30.

This is lower than 2015-2016 and 2008-2009 (refer illustration). There is no sign of this average bottoming out yet. At this time, it looks like low oil prices are here to stay.

What is the impact of low prices on economies?

Singapore, Thailand, Taiwan and South Korea are likely to be the top 4 countries to benefit from low oil prices.

Reuters recently published an article on spending cuts announced by the largest oil companies. 22% cut in expenses is significant. However, sustained low oil prices is likely to result in most oil companies posting losses this year. Which makes it unlikely to see value in oil production stocks this year.

Analyzing 12 familiar names, Saudi Aramco and Cabot were the only exception (refer illustration).