Oil unlikely to see a sustained rally over the course of the next year – Rabobank

By FXStreet FXStreet (Córdoba) – According to Christian Lawrence, Market Strategist at Rabobank, oversupply is likely to keep crude oil prices lower for a long time.

Key Quotes

“It is fair to say that a price range of USD 40-60 for Brent oil would likely be a better way of displaying our view given how we see price action panning out – volatility has risen notably and sharp intraday moves are becoming the norm. We expect oil to remain low as the fundamentally driven path of least resistance and a move into the 30s cannot be ruled out but price action will be susceptible to these sharp, short-lived moves higher.”

“Oversupply remains the dominant theme and it is this side of the equation we expect to dominate price action but the demand side is unlikely to help push prices higher either given the deteriorating global growth outlook.”

“The outlook for demand has deteriorated notably this year as global growth forecasts continue to be revised lower. Much of the decline has been driven by slowing emerging markets, many of which themselves have been hurt by the rapid fall of commodity prices over the past year. (…) In short, from the demand side we see little …read more

Source:: FX Street