As crude oil prices rally back above $30 per barrel, the chairman of India’s Vedanta Resources told CNBC that the only way for the commodity was up.
“Definitely we are at the bottom, but in India a lot more has to happen. The (new) Modi government has come and people have a lot of expectations. The sense of urgency has come,” Anil Agarwal, the group chairman of the London-listed commodities giant told CNBC on Friday from the World Economic Forum in Davos, Switzerland.
Agarwal added that low prices were “hurting everybody,” but that Vedanta was advantaged by being diversified across commodities including oil, copper, iron ore and aluminium.
U.S. light (WTI) crude futures rallied by around 4 percent early on Friday to trade above $30 a barrel, having plummeted to 2003 lows below $27 a barrel on Wednesday.
Oil prices have plummeted since mid-2014 by around 70 percent due to a worsening supply-demand gap. The U.S. and Iraq have increasedproduction, while the OPEC group of oil-producing countries has held supply. Meanwhile, demand growth for energy has slowed, largely due to the deceleration in the Chinese economy.
The International Energy Agency warned on Tuesday that continued oversupply would put extra strain on the market.
The rout in oil prices has hit commodity producers like Vedanta Resources hard. Its share price has declined by around 22 percent this year.