Thursday brings the most-watched meeting of the Organisation of Petroleum Exporting Countries (OPEC) in years, and it all hinges on what Saudi Arabia decides to do.
With central banks remaining in easy monetary policy mode and with signs of a recovery – most notably in the US and the UK but also to some extent in the eurozone – visible, analysts have been betting on stocks rather than bonds, at least until the end of the year.
Rotation between sectors is “extremely frequent” as investors try to get additional gains before the year-end by switching to underperforming sectors, strategists at Libra Investment Services said.
The price of oil is already very high by historical standards, with Brent staying above $100 per barrel because of tensions in the Middle East and uncertainties created by the Arab Spring, Tom Pugh, commodities analyst at Capital Economics, said.
But growing supply and relatively slow demand is likely to push oil prices lower over the next five to 10 years, he wrote in a market note.