Okuma Group say that the price of oil falling below $73 per barrel, although likely to be short-lived, is a stark reminder of the uncertainty that underpins the global economic recovery.
A source close to the Asia-based asset management firm said that the robust recovery underway in emerging economies like China and India was proving to be insufficient to draw a line under the price of crude oil . . . for now.
The source added that bearish sentiment would prevail across all commodity classes and that pessimism would remain strong in the short-term with anything considered risky being sold off.
Okuma Group are thought to believe that nothing short of a positive US payrolls number in excess of economists expectations could turn the current selloff in commodities and equities around.
Oil fell 5 percent on Thursday, its steepest daily drop since July and the fifth-largest trading volumes ever on the New York Mercantile Exchange as investors dumped commodities and other risky assets.
Okuma Group analysts said that the long-term bull market in crude oil remained eminently intact but that as long as there was doubt and uncertainty surrounding the global economic recovery, volatility would prevail.