With prices sliding once again in recent weeks, opinions on whether the slide will continue are predictably mixed. We previously directed attention to the CEO of Anadarko Petroleum's prediction that oil is headed for $60 per barrel by the end of 2016.
A report from CNBC indicates that analysts do not share the same optimistic viewpoint:
Oil prices are heading lower and could fall into the $30s before the latest shakeout ends sometime during the fall months.
But analysts say this sell-off is nothing like the one that took West Texas Intermediate crude to $26 earlier this year, and some of the factors behind it are seasonal.
West Texas Intermediate oil futures are down 11 percent so far this month, after rallying above $50 in the spring. WTI was trading settled a half percent lower at $42.92 per barrel Tuesday, after breaking below its 100-day moving average of $44.25 on Monday.
The world remains oversupplied with crude oil, but the fact that it has become very oversupplied with gasoline is currently worrying the market.
"The gasoline inventories are 10 percent above a year ago level, and that's feeding back into crude," said Greg Priddy, director of global energy at Eurasia Group. The real fear is that the demand for crude will drop even further once refineries go offline as they normally do in early fall for routine maintenance ahead of winter fuel refining.Click here to continue that article.
Connect with us on Facebook and Twitter!