Equity markets started favourably into the new year. US – Iran tensions have temporarily pushed the price of Brent to 70.0 US$/barrel. Subsequently, inventory data issued by the US DOE have shown high inventory levels of crude and oil products. Later, the outbreak of the “Corona” virus ” in Mainland China became a serious epidemic. The standstill of parts of China’s economy had a significant impact on the sectors of transportation and energy. Flights into China have largely been suspended. Given the prolonged shut-down of factories China had substantially reduced commodity imports. The price of Brent oil fell back to 58.16 US$/barrel and thereby realising its biggest monthly drop of -12% since November 2018. The Price of Gas (Henry Hub) fell by 16% to a record low of 1.85 USD/MMBtu. Freightrates for crude (VLCC) and Dry Bulk (Capesize) have dropped between 60 and 70% on a monthly basis. LNG – shipping stocks and energy shares had the greatest impact on the negative fund return.
More detailed fund information can be found in the attached Factsheet January 2020.
Seahawk Investments GmbH