Has Death of the Oil Industry Become Greatly Exaggerated?
Most every speculator either by profession or hunch agrees the oil industry in the second quarter is in for the ride of its life before some semblance of normalcy or “new” normalcy returns. But what’s interesting to see right now is how world populations are responding post-COVID-19. Germany, a country renowned for its mass transit systems—transit use is exponentially greater than in the U.S.—is returning to the wheel to avoid human contact. Data from Apple Maps shows more people looking for driving directions with the number of requests in Germany now rising to 79% after falling by half between mid-January and March. Traffic in China’s three largest cities now exceeds 2019 levels, and we’ve seen what those traffic jams look like on a regular day. The Great Virus is changing our behaviors in curious ways that may well become the very catalyst needed for an industry that’s been punched hard in the gut. And many economists stand firmly optimistic that once demand and prices rebound and oversupply becomes undersupply, recovery will come back with a roar.