BP says world oil demand peaked in 2019 as central banks make “unconventional” policy the norm — and that’s all good for Bitcoin. Bitcoin (BTC) starts a new week in uncertain territory as $10,000 stays in place but fundamentals shift to bullish.
Cointelegraph highlights five things that could shape BTC price action in the coming days. In what will likely become a frequently-quoted announcement, oil giant BP said this weekend that the world has hit peak demand for the black gold.
In a report quoted by Bloomberg, BP said that demand for oil would stay “broadly flat” for the next twenty years, with pressure coming from alternative fuels and coronavirus.
“It brings forward the point at which oil demand peaks to 2019.”
“It subsequently recovers but never back to pre-COVID levels,” Spencer Dale, the firm’s chief economist said.
With coronavirus at the helm and lockdown returning to at least one country on Monday, Bitcoin looks poised to benefit from oil and fiat currency weakness, as before.
The startling admission is yet another surprise to come out of the global economy, at the same time as central banks admit that unconventional monetary policy has become the norm in 2020.
As Cointelegraph reported, previous extreme volatility in the price of certain oil assets allowed BTC to shine as a hedge against losses.
Another week, another meeting for the United States Federal Reserve — and a chance for safe havens to capitalize on its policy shifts.
On Wednesday, the Fed will outline how it plans to implement economic measures which will impact inflation — something which previously sparked dollar weakness.
“Maintaining a policy status quo in this context would be akin to throwing in a towel, which would undermine the credibility of the new framework right out of the gate,” Aneta Markowska, chief financial economist at Jefferies told MarketWatch on Monday.
Gold markets are already considering the likelihood of a shake-up, analysts say, betting on the Fed putting itself in an increasingly difficult position. The precious metal has formed a “golden triangle” and is ripe for a breakout.
Any actions from the Fed could weigh on the U.S. dollar currency index (DXY) once again, something to which Bitcoin has shown significant inverse correlation since July.
For Bitcoin, it’s all about DXY — a reversal of recent strength at the beginning of September would be a clear bull signal. Conversely, continued gains would likely keep selling pressure at $10,500 intact.