Oil slumps as Goldman says price could drop to $20
Crude oil is -2.2% at $44.92 despite the IEA predicting the
"largest cut in non-OPEC supply in more than two decades" due to low
oil prices and as Goldman warns that crude could collapse to $20 a barrel.
"The oil market is even more oversupplied than we had
expected and we now forecast this surplus to persist in 2016,” Goldman
explained, although it also said that $20 isn't its base case scenario.
Still, it's a nice figure that generate lots of tweets, as
are the forecasts by Goldman and others in the not so distant past that oil
would hit $150-$200 a barrel.
In its September Oil Market Report, the IEA forecast that
non-OPEC supply will drop nearly 0.5M bpd to 57.7M bpd in 2016, "the
biggest decline in more than two decades." U.S.
light tight oil, the driver of US
growth, is seen down 400,000 bpd.
OPEC supply dropped 220 000 bpd in August to 31.57 bpd,
although that's still 1.2M bpd higher than last year.
The IEA predicts that global oil demand will climb to a
five-year high of 1.7M bpd this year before easing to 1.4M bpd in 2016.
OECD oil inventories rose another 18M barrels in July to a
record 2.9B barrels.
ETFs: USO, OIL, UCO,
UWTI, SCO, BNO,
DBO, DWTI, DTO, USL,
DNO, UHN, OLO, SZO, OLEM
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