Oxford Energy Podcast – The oil demand shock and benchmarks
The oil demand shock, due to the COVID-19 pandemic, placed markets and benchmarks under considerable stress. Both the physical and financial market infrastructure were tested and stretched, but it then adapted, with physical differentials and freight rates allowing crude to flow from surplus areas to demand centres. In the process, however, WTI turned negative, the oil benchmarks in the Persian Gulf, that are supposed to value the same types of crudes, diverged, and the Shanghai futures contract overshot other benchmarks. In this podcast, David Ledesma discusses these developments with Bassam Fattouh, Adi Imsirovic, and Michal Meidan as they reflect on what these events mean for global benchmarks and their future evolution.