Based 80% on technicals and 20% on fundamentals, oil looks quite oversold:
Technicals:
Oil has now traded below RSI 30 mark (last few times it reached these levels it bounced back on oversold levels) and is finding support and flirting with its 1 year trend line.
Fundamentals:
Oil consumption continues to increase globally, even within the context of extra supply from the US. Globally we are drawing on inventories which has caused the WTI curve to flatten over time and make the oversupply situation less severe. Oil cannot go to zero (well, at least not in our lifetime) so fundamentally speaking oil will likely hold in a very tight range in current levels or rally a bit.
CL1
Technicals:
Oil has now traded below RSI 30 mark (last few times it reached these levels it bounced back on oversold levels) and is finding support and flirting with its 1 year trend line.
Fundamentals:
Oil consumption continues to increase globally, even within the context of extra supply from the US. Globally we are drawing on inventories which has caused the WTI curve to flatten over time and make the oversupply situation less severe. Oil cannot go to zero (well, at least not in our lifetime) so fundamentally speaking oil will likely hold in a very tight range in current levels or rally a bit.
CL1