Energy Markets: The Cold vs. Warm Debate & China’s Demand Surge
Global growth is wavering like a tide, and every economist is watching the numbers like a hacker watches a server for a crack. When the world’s demand curve starts to flatten, oil prices take a roller‑coaster ride—first up, then down. That’s the story that Wael Makarem, Senior Market Strategist – MENA at Exness, is telling us.
China’s Reopening: The New Powerhouse
- Oil demand is seeing a jump thanks to China’s step‑by‑step reopening after strict zero‑COVID rules.
- Industry is humming again, but whether the rebound is S‑shaped or a straight line remains a mystery.
- The Chinese government has pre‑emptively raised oil import quotas—an attempt to keep the economy rolling.
- With China’s engines revving, the oil market could stay steady—perhaps “positive” in the best case scenario.
Cold Europe, Warmer Markets? The Gas Dilemma
While oil finds a new fan club in Beijing, natural gas is looking at a lukewarm holiday in Europe. The key pain points:
- Warmer winter temperatures mean less heating demand.
- 2022 was a hot‑spot for gas in Europe because of Russian sanctions and the Ukraine conflict—those high‑temperature spikes are not guaranteed to repeat.
- Unexpected weather swings could still rear their heads during the remainder of the cold months.
- Past supply hiccups in Eastern Europe and Turkey remind us that transport issues can send price shockwaves.
Recession Fear: The North Star of Uncertainty
Even with China’s confidence, there’s a looming “slow‑down syndrome” that could drag the entire energy sector further. The global economy might face a decelerated growth rate; if the recessions do bite, the upside potential for oil and gas could shrink noticeably.
Bottom Line
Energy markets will be a mixed bag that season: China’s pull will grip oil, but Europe’s cooling will weigh on gas. Keep an eye on global growth vibes, and you’ll know when the market’s playing “walk‑and‑talk” or “stomp‑and‑ha” next.
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