As the world economy slowly begins to recover from the Covid-19 crisis, the tremendous impact on the oil industry will see continued struggles with oversupply and permanent damage, meaning a quick recovery is unlikely.
This most recent drop in prices marks the end of the oil market’s supercycle that began in the early 2000s. For countries reliant on oil sales, this latest price collapse has created further political instability.
During the Covid-19 pandemic, the demand for oil fell globally; this drop was triggered first by China, which came to a standstill in January. Then in February and March came the lockdowns of other major economies in Europe, the US, and Latin America.