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00:00By oil by oil what sunflower oil or whatever is. Well maybe sunflower oil is more profitable these days. Two things here . Like China consumes about 12 percent of the global oil. I as long as China is hasn't really its roots bottom then at least the third biggest consumer will not really support the market . Point number one point number two Saudi and Russia come out and says look we have agreed to stop this nonsense and we'll stabilize output. Iran and Iraq come out and says No you won't . So that's exactly right to say that one day I mean at the end of the day it makes some sense. In other words we're back where we are. What does it mean. It means oil price stays are the 30s for perhaps another year another year another year. But what happened to all this crowded trade of second half we're going to see you know oil prices now are going up to 45. Yeah well it doesn't look it doesn't look like because of the supply and demand considerations how incredibly boring supply demand The demand is flat. The supply continues to potentially increase because Iran will sell more. I don't have the slightest doubt about that and even if it is that little mole it keeps the prices basic economics one Jason Kelly going on because I think we focus too much on China I mean just and seems to share your view that you know we keep fixating on things like that capital outflows the effects preserves and that you know maybe we should all chill out a little bit. Do you think it's the situation's not as bad or do you think the fallout might be . I said I'm going to sound like an economist. Yes you are absolutely right. But yes you are absolutely right when it comes to commodities forget about oil about copper about iron ore. No no. When it comes to China being the main driving force of the global economy. Look exports from the United States to China. Exports from the United States to China is about point eight point eight eight basis eight to 80 basis points not even one percent of the United States GDP. It doesn't matter. So in other words if China booms or busts . Okay. The experts from the United States China is such a small percentage of the total exports of United States you won't make any difference. But it's not just that money. That's not the only linkages there. I mean there's so many other linkages Satya Nadella. So it's my turn to interview you. I mean already seeing evidence of happening this actually in other parts of East Asia Southeast Asia where we see the China slowdown is affecting those economies. Now those economies themselves are then affected by what happens because they also have trade links with the United States. And then of course we've got the Europeans which are involved as well. So then we have that linkage too. So it is a globalized economy can't just point to one link. So we are talking about multipliers effect. Yeah. But unfortunately again unfortunately this works both ways. In other words if I say yes Taiwan is a very important line for China South Korea is an important line for China. And if that hits them then that hurts their economies and therefore. And then I take a deep breath . How important is they want for Japan. Very little. So I cannot necessarily draw the conclusion that because there is a multiplier effect it is significant enough to make a huge amount of difference. So the more that I have turned it over the more and more purely in terms of quantitative something that is of opinion is this say yeah. You're absolutely right let's chill out and China a We've done it again. Been there done these China China. I'm not seeing the forest. Let's go let's go somewhere else. It's not like Russia was saying because look exports from you ask but we're talking about multinationals here with huge exposure in domestic. Let me give you a spin. Thank you for asking this. I was very pleased with himself. Like the theory not the luxury goods BMW used Ferrari. OK. How important is the LAX shooting sector in the Italian economy is about 6 percent 7 percent of GDP. It is big. But please again you know if the Chinese imports of luxury goods slowed down this is not going to impact the importance of BMW. China is their single biggest market. Okay. How important is BMW in the German economy again and take a deep breath and tell you it is a very spare a small percentage something like two to three percent. So we cut it as much as that. Yeah. Well it quickly sounds important okay. But we cannot take simple single companies and says they are really aching because of China . This is bound to be bad for Germany. Seventy five percent of all European trade is European. The biggest client for Germany is the rest of Europe. So blame the rest of Europe. We don't get .

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Oil's Outlook: Where Will Prices Head Next?

Andrew Freris, chief executive officer at Ecognosis Advisory, discusses oil prices and China's economy. He speaks to Bloomberg's Haidi Lun, Rosalind Chin, Angie Lau and Rishaad Salamat on "Asia Edge." (Source: Bloomberg)

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