Technical & Fundamental Oil Reports Specialists

Follow us

Oil prices fight to find a bottom

Published Monday, January 19th, 2015

Oil prices experienced another roller coaster week. Every time they tried to get up from the canvas they were hit with another punch. It began on Monday with Wall Street ganging up and to a man making massive downward revisions to their forecasts. If you did not know differently you could imagine that they had all gathered together in a weekend seminar and drunk a highly addictive concoction of bear juice. 

The leader of the commodity pack is Goldman and they now see Brent averaging $42 bbl and WTI $40.50 bbl in 2Q. They revised their 2015 average forecast on Brent down to $50.40 from their October number of $83.75 with WTI at $47.15 from $73.75. They do not see a rapid V-shaped rebound but rather a U-shaped price recovery that will see Brent averaging $70 bbl and WTI $65 bbl in 2016. Others are talking of a short term price fall to $30 bbl.  

The revisions ensured that oil began the week with a migraine. It continued on Tuesday with the UAE oil minister telling a conference that OPEC would not be changing strategy. He called on other oil producers to act rationally and to assume that the days of OPEC stepping up to provide price support whilst others grabbed market share were over. The Kuwaitis’ added their public support later in the week.

to read the rest of the report, please click here

Posted by David Hufton