U.S. crude prices notched a weekly loss of 29%, the steepest since the outset of the U.S./Iraq Gulf War in 1991. Brent crude dropped by 20%. Both benchmarks have dropped for four straight weeks and are now down about 60% from beginning of the year. Last week was the worst as oil barrel composed 4 out of 5 biggest daily drops, the biggest was on 23 march when it dropped massive 32%.
Multiple reports from analysts and investment banks see further room to fall for oil because of fears over a lack of adequate storage. Any traders with the capacity to store oil are probably putting their hands up, looking at the contango. Oil could head to $10 to $15 a barrel very quickly if OPEC and Texas can’t reach an agreement on cutting production. Texas regulators have not intervened to cut output among state producers since 1973.
S&P cuts WTI forecast to $25. S&P cut its oil price forecast for 2020 by $10 per barrel since its last estimate. The firm now sees WTI averaging $25 this year, with $30 for Brent.
Looking at charts, $15 area looks solid for now if price does not hold on $27 level.
Multiple reports from analysts and investment banks see further room to fall for oil because of fears over a lack of adequate storage. Any traders with the capacity to store oil are probably putting their hands up, looking at the contango. Oil could head to $10 to $15 a barrel very quickly if OPEC and Texas can’t reach an agreement on cutting production. Texas regulators have not intervened to cut output among state producers since 1973.
S&P cuts WTI forecast to $25. S&P cut its oil price forecast for 2020 by $10 per barrel since its last estimate. The firm now sees WTI averaging $25 this year, with $30 for Brent.
Looking at charts, $15 area looks solid for now if price does not hold on $27 level.