How long will it take for the oil prices to stabilize

after the COVID-19 pandemic?

• The onset of COVID-19 pandemic and its global spread has
resulted in a fall in oil prices due to subdued demand foreseen and
the price war between Russia and Saudi Arabia. The prices
recovered, however, partially after hopes for an agreement
between Russia and OPEC increased.

• Nevertheless, the prices will remain volatile for at least six

months after the COVID-19 pandemic, as seen from the results of
a poll Verdict conducted recently to assess how lasting the impact
of the pandemic will be on oil price volatility.
• Two-third (67%) of the
respondents opined that the
impact will last for six months
to more than a year following
the pandemic.

• While 36% believe the volatility

will stay for more than a year
following the pandemic, 31%
believe that it’ll last for more
than six months
 Which oil and gas segments among petrochemical, refinery, upstream, and midstream will pick-up faster
than others after COVID-19.

 Analysis of the results shows that a

majority think the petrochemical
segment would bounce-back faster than
the rest.
 The petrochemical segment is expected
to be more resilient, according to a
majority 32% of the respondents,
followed by the upstream and refinery
segments as opined by 26% of the
respondents each, while 15% feel that
midstream will pick-up faster than the
other segments.
State Conflict and Oil prices
• In a statement by the Saudi Energy Minister to halt the voluntary reduction
of oil production in July, which led to a decrease in oil prices.
• This statement came after Saudi Arabia voluntarily reduced production by
one million barrels per day after its commitment within the OPEC Plus
agreement.
• As one economist has stated, the rise that has occurred after the agreements
that have already occurred by OPIC Plus may lead to a price collapse.
• The Saudi minister added that his country has no intention of extending the
voluntary reduction in oil production.
• If this statement is implemented, there are high expectation for lower oil
prices.