BARCELONA (ICIS)--The oil price crash and coronavirus will trigger a global recession as oversupply and poor demand disrupt chemical markets, two senior consultants said on Monday.
"We’ve always said that oil is overpriced at $50bbl – there is an enormous amount of excess supply and a collapse in demand. There are parallels to 1985/6 when oil went from $30/bbl to $10/bbl and stayed there more or less for 15 years," said International eChem chairman Paul Hodges.
Hodges, who forecast the price crash a week ago in a blog post, believes that coronavirus is simply the trigger to a forthcoming crisis caused by central bank mismanagement and driven fundamentally by the demographics of an aging population globally.
ICIS senior consultant, Asia, John Richardson added: "We can expect global recession, but could it also morph into a financial crisis? Lower crude means lower costs for naphtha operators, but what about volume? We are looking at negative growth across most chemical products."
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