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DUBAI, July 17 (Xinhua) -- A senior banker in United Arab Emirates (UAE) said on Sunday that the weaker oil prices may cloud the Gulf Arab stock indexes despite their latest upward trend.
"The GCC (Gulf Co-operation Council) equities are held back to a degree by the weaker oil prices," said Gary Dugan, the Chief Investment Officer of Wealth Management at the UAE's biggest bank Emirates NBD, in his weekly e-mailed market commentary. The six GCC countries are Arab oil and gas suppliers Saudi Arabia, the UAE, Kuwait, Bahrain, Qatar and Oman.
Supply and demand factors have kept oil prices weaker, with some commentators suggesting a risk of dropping to 40 U.S. dollars per barrel, Dugan added.
"Previous supply disruptions in Canada and Nigeria have waned and meanwhile fears about the impact of Brexit on global demand has added to the near-term downside risks to the oil prices," the investment expert said.
Saudi Arabian Tadawul index, the benchmark for the GCC's biggest bourse, has lost 3.34 percent since Jan. 1, apparently unable to keep up with the market rally in the United States and elsewhere. On Friday, the U.S. bellwether indexes Dow Jones Industrial Average and the S&P 500 closed at all-time highs.
The price of oil has fluctuated between 44 and 50 dollars per barrel since early June, far from enough for all the GCC states to reach fiscal balance.
Paris-based International Energy Agency said on Wednesday that record-high oil stocks would threaten the recent "stability of oil prices."
