Clin­ton vic­tory could be good for oil price

Pres­i­den­tial elec­tion is af­fect­ing prices

7 Days in Dubai - - FRONT PAGE -

‘Peo­ple are be­ing anx­ious. We see gold go­ing up and I think even the dol­lar is a lit­tle bit go­ing down.’ – Mo­hammed Ali Yasin

Jit­ters over the out­come of the US Pres­i­den­tial Elec­tion are af­fect­ing oil prices more than the in­abil­ity of OPEC to come to a deal on pro­duc­tion out­put, a se­nior banker has sug­gested.

Mo­hammed Ali Yasin, Manag­ing Direc­tor of Na­tional Bank of Abu Dhabi Se­cu­ri­ties (NBAD), also said that if Demo­crat Hil­lary Clin­ton wins there is likely to be “re­lief in the mar­ket”.

He was speak­ing on Dubai’s Bloomberg Mar­kets Mid­dle East pro­gramme yes­ter­day as pre­sen­ter Manus Cranny said an­a­lysts pre­dict a 3 per cent up­turn in mar­kets if Clin­ton wins ver­sus a “15 per cent down­turn” if Repub­li­can Don­ald Trump clinches vic­tory on Novem­ber 8.

Last week, OPEC made lit­tle progress on an agree­ment to cut pro­duc­tion dur­ing a meet­ing in Vi­enna. Any cut would likely re­sult in a rise in oil prices.

Yasin told the pro­gramme: “I’m not sure what’s hap­pen­ing with oil prices is re­lated to non-agree­ment of OPEC or the de­lay of agree­ment. I think the mar­kets are now in a jit­tery mood be­cause of the elec­tions.

“The ques­tion that al­ways comes to mind is if they reached an agree­ment five days ago would the oil prices have gone up? And I think my an­swer would be no. I think there is a risk kind off at­ti­tude with many of the in­vestors now and a lot of that is com­ing out.

“Tech­ni­cally, I think we are still trad­ing in an ac­cept­able range… af­ter break­ing the $52 about ten days ago, we could be now be­tween the $46-45 back to $51-52.”

He said the cur­rent mar­ket at­ti­tudes “re­ally shows peo­ple are be­ing anx­ious”.

Yasin said: “We see gold go­ing up and I think even the dol­lar is a lit­tle bit go­ing down.

“I think over­all peo­ple are just stay­ing on the out­side and that means it could be good and bad de­pend­ing on the re­sults.”

He added: “If you get maybe a Clin­ton kind of win prob­a­bly we may see a re­lief”.

Yasin said the US re­sults may not nec­es­sar­ily have a long-term ef­fect, “but we think ini­tially that if Clin­ton wins there will be re­lief in the mar­ket”.

The bank­ing chief also said he be­lieves Saudi Ara­bia, the largest econ­omy in the Mid­dle East, could get by fi­nan­cially if oil prices re­main at $50 per bar­rel. The king­dom has been huge pub­lic spend­ing cuts over the past year as oil prices fell from $115 in 2014 to $27 at one point in Jan­uary of this year.

Yasin said: “I think if this con­tin­ues they are bud­get­ing for that and they’ve cut down their ex­pen­di­ture over the past year and that could con­tinue. It’s go­ing to be tough times for a year or two but I think, yes, they can.”

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