Oil Price Tanks

choi

There is no need to read any of the reports.

Compare
(1) Steve Forbes, Nuggets Amidst the Muck. Forbes, Jan 18, 2016.
http://www.forbes.com/sites/stev ... 4857a0b34cb8d718cd1
("Removing the four-decades-old ban on oil export [from US], a relic from an era when it was thought we were running out of the stuff because the price was going up so much. The rapid rise in petroleum prices wasn’t a result of the Arab oil embargo–imposed because we supported Israel during the Yom Kippur War–or of a looming oil shortage. It was a result of the weak dollar. We saw the same phenomenon in the early 2000s, when a weak greenback sent the price of oil from around $25 a barrel to over $100. Repealing this prohibition will help our beleaguered producers land new market")

My comment: Presumably Mr Forbes would say that oil price plunges is caused by dollar's rising value. But dollar is not the whole story in oil price fluctuation.

with (2)
(a) The oil market $20 Is the New $40; Why the oil price has plunged. Economist, Jan 16, 2016
(The trouble "is that apart from India and a wobbly China, demand [for oil] is not looking promising anywhere this year")
(b) Brian Spegele and Yantoultra Ngui, Oil Rout Forces Belt-Tightening in Asia; State-owned firms are in retreat as oil demand from China is set to recede further. New York Times, Jan 20, 2016.
http://www.wsj.com/articles/asia ... dwindles-1453208005

four consecutive paragraphs:

"Multiple factors are contributing to concern over Chinese oil demand. First is that persistently weak industrial activity in China could crimp demand for diesel.

"Similarly, a concern for oil markets is the decision by Beijing last week to suspend downward retail price adjustments to gasoline and diesel when global crude prices fall below $40 a barrel.

"The government says the move is aimed at helping domestic refiners as well as curbing pollution, and will likely curb what has been robust gasoline consumption by Chinese drivers.

"Moreover, strong imports by China in 2015 were partly the result of government efforts to fill its strategic reserves. Analysts believe such reserves are now nearing capacity, and could contribute to weaker crude oil import growth this year.

My comment:
(a) The title (Oil Rout Forces Belt-Tightening in Asia) alludes to Asia's state-owned oil/gas firms that will reduce production now that the prices are so law.
(b) As for the subtitle (China is set to retreat further), see quotation.