Oil in a dive after the Opec+ agreement the risk of stagflation is frightening

Oil sinks below $ 70 a barrel, a victim together with the stock exchanges of sharp falls after the weekend in which Opec Plus put the pieces back together, decreeing a gradual increase in production in the coming months The agreements reached by the coalition, which could lead to the total elimination of the cuts by September 2022, however, only partially weigh on the market, conditioned by a climate of general and growing pessimism.

The resurgence of Covid infections in many areas of the world is leading to new closures, with a probable impact on oil demand and production activities. And investors are worried that the global economy may be entering a phase of stagflation: a surge in consumer prices - largely linked to tensions on raw materials and logistics - accompanied by a slowdown in growth.

On the OPEC+ front, the coalition, at least for now, seems to have made peace with the United Arab Emirates. And the agreement approved in a lightning summit on Sunday 18 paves the way for an increase in supply that risks being excessive compared to oil needs, especially if the economic recovery were to stop.

The prices per barrel, negative since the beginning of the session, weighed down the falls in parallel with the share prices, losing about 6%. Brent has also slipped below the psychological threshold of 70 dollars, while the WTI has sank below 68 dollars. Possible relapses still uncertain Analysts are actually divided on the possible effects - bullish or vice versa bearish - of the decisions of Opec Plus. The agreement reached on Sunday 18, just in time to anticipate the Islamic holiday of Eid al-Adha, has cleared the field of many uncertainties and averted the danger of a breakdown in the coalition, which in theory could have provoked a price war.