Global economy's patchy recovery in 2021 could test oil bulls' patience

THE recent move by the Organization of the Petroleum Exporting Countries and allies (Opec+) on new output cuts for January 2021, aimed at speeding up oil's recovery, led a rally in crude prices. But it did not take long for the hype to wear off.

With that, as 2020 - a horrid year for oil when prices plumbed to historic lows owing to pandemic-led demand destruction and a price war - closes in, it appears that the commodity is set to start the new year on the back foot.

Low oil prices are a double-edged sword - while it is a boon for oil importers and consumers, it can also hurt energy firms and oil-producing nations. The latter could result in investment cuts and more jobs losses, which could undermine the widely-expected rebound (albeit uneven) in global growth next year on the back of ample liquidity, sovereign support and a vaccine boom.