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Is there an end in sight for the oil price slide?

And what might this mean for forex market trends?

Here are the latest updates you need to be aware of.

Venezuela is making the rounds

Among the oil-producing nations, it’s Venezuela that’s been very hard at work when it comes to getting leaders to agree to adjust production levels. Venezuela’s new oil minister Eulogio del Pino has been jet-setting from Moscow to Riyadh then to Doha in order to convince their officials to do something to stabilize oil prices.

A quick glance at Venezuela’s economic statistics reveals why it’s pulling out all the stops to broker a deal on oil production. This commodity accounts for roughly 95% of Venezuela’s exports and 25% of its overall GDP, which was great when crude oil was trading safely above $100/barrel… and not great at all these days.

Earlier this year, the country’s president already declared a state of emergency, as its economy has contracted for the eighth consecutive quarter. Analysts predict that the oil-producing nation needs the commodity back up to around $111/barrel just to break even, which means that Mr. del Pino has his work cut out for him.

OPEC and non-OPEC nations have a pow-wow

On a slightly more positive note, Venezuela’s efforts have been bearing some fruit, at least when it putting the leaders of OPEC and non-OPEC member nations in one room.

An emergency meeting was held with leaders of Iran, Algeria, Nigeria, and Ecuador the other weekend, then another pow-wow between Russia, Venezuela, and Qatar is going on as of this writing.

So far, top dog Saudi Arabia still stubbornly refuses to give in to any oil production cuts, as its officials are more interested in grabbing back its market share from competitors.

For them, plummeting oil prices would eventually drive other oil-producer wannabes like the U.S. out of the game if profitability keeps tanking. Good plan. Not working, though. Maybe it’s time to try Plan B?

Talks of an oil production freeze are also on the table, and this would entail maintaining the current levels in order to prevent the supply glut from getting worse.

There has been a lot of back and forth, with non-OPEC nations like Russia also expressing their support for various proposals, but no solid agreement has been made.

Crude oil downtrend still intact

While the recent meetings and speculations of a compromise among oil producers have allowed crude oil prices to rally in a few instances, the downtrend still looks very much intact.

WTI Crude Oil Futures 4-hour Chart
WTI Crude Oil Futures 4-hour Chart

It’s not hard to imagine how much havoc this price tumble could wreak on the global economy since we’ve already seen what might’ve been the tip of the iceberg last year. At that time, inflation took a nasty hit and massive layoffs were seen among energy companies, causing central bankers to scramble to take action.

Word through Wall Street is that European banks are already starting to feel the pinch of falling oil prices, contributing to hefty stock market losses in the region. Apparently, a large number of these institutions are heavily exposed to loans from oil and gas companies, and it doesn’t help that a similar situation is unfolding in the United States.

Demand: The other side of the oil equation

Now here’s the kicker: Even at these bargain prices, buyers still don’t seem to be in the mood to guzzle up on crude oil.

The latest trade balance from China, one of the world’s biggest consumers of commodities, revealed that imports fell by 18.8% in January, marking their 15th consecutive monthly decline. Three guesses on which commodity is in the top spot for Chinese imports…

According to the latest report from the International Energy Agency (IEA), global demand growth for oil will “ease back considerably” from its peak of 1.6 million barrels per day last year to just 1.2 million barrels per day this 2016. The agency explained that demand is likely to be “pulled down by notable slowdowns in Europe, China, and the U.S.”

However, the IEA has also noted that forecasts of $10/barrel for oil prices might be too extreme, assuring that the market will balance itself at some point.

For now, it seems that oil traders are shrugging off more headlines on supply woes and are more sensitive to expectations of production cuts, hinting that the dive might be over sooner or later.