Oil and stocks reduce Omicron’s threat to economy: The Tribune India

Tribune Information Service

New Delhi, January 5

Credit rating agencies may be pessimistic about the economy due to the global increase in infections, but oil prices and stock prices have risen in the first days of the new year as the two times Strong GDP growth appears to have averted the threat of the Omicron variant of Covid. The two concerns that could hold back economic growth remain inflation and the Chinese real estate sector.

The Sensex in India crossed the 60,000 mark and its sentiments were shared around the world, such as the FTSE 100 in London which crossed 7,500 points for the first time and the Dow and S&P 500 posting gains in the States. -United. The message that emerges is that they consider Omicron to be less numerous than the Delta variant, even though infections are increasing at a rapid rate. The recovery in economic activity is being promoted by the resolution of supply chain bottlenecks which have significantly reduced the waiting time for sea containers and hence freight rates as well.

The second indicator – oil – was also improving without any sign of US President Joe Biden’s ambitious plan to unload some of America’s strategic oil reserves into the market in concert with India, China, Japan, Korea. of the South and the United Kingdom. The 13 OPEC members and their 10 allies don’t think Omicron is deadly enough to hit oil demand and have decided to keep ramping up production by four lakh barrels a day. The initial nervousness after Omicron was detected in several countries in December, which led to lower crude prices, appears to have subsided.

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Felix J. Dixon