UBS: Brent crude oil sell-off Wednesday ‘out of whack’

Swiss investment bank UBS said Thursday it was standing firm on its bullish outlook for the price of oil despite one of the biggest sell-offs in recent years.

The price for Brent crude oil, the global benchmark for the price of oil, dropped roughly 6 percent in trading Wednesday, it’s sharpest single-day decline in terms of percent since 2016. The sharp decline followed a report from the Organization of Petroleum Exporting Countries that supply-side fears should ease and on word Libya was on pace to return to full production capacity of nearly 1 million barrels of oil per day following weeks of unrest.

“We think the price drop is out of whack with the fundamental reality of low spare capacity globally and Iranian output set to decline considerably, which should keep the oil market vulnerable to additional supply disruptions in the months ahead,” analysts Wayne Gordon and Giovanni Staunovo wrote in a note emailed to UPI on Thursday…

 

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