It’s not like it is secret or complex. OPEC keeps saying it wil not reduce supply and keeps that promise. Shale operators continue to get more nimble , and Russia for cash flow and market share must continue to pump the stuff.
And on the demand side China is becoming more mature economically, hence slower growth from what has been the case for the last several years and other emerging economies from which greater demand is hoped for are just not growing that fast.
So when the International Energy Agency states the obvious today, oh, the market finally reacts.
I just finishing reading several articles on the oil price , how all the ‘ experts’ got it wrong again for this last quarter and the year as a whole. They are getting almost as bad as the peak oil people, other so called experts that is, who said by now , we would be really running short of oil and the price would be well over one hundred dollars a barrel. Calamity of calamities. Never hear these people admit that they were wrong. They are all gone underground. This is also true for the population predictors and food supply predictors. Armageddon did not happen . The ink and paper that has been wasted on these doomsayers has been such a waste.
Two different investment fund companies , big boys , like managing hundreds of billions of dollars, tried to explain their mistakes to the Wall Street Journal concerning their bad price predictions. One talked about how they are not really used to supply induced price falls, and the other talked of not really seeing the resilience of Russian production or the shale producers . Now anyone who could not see the Russian thing must be living on the space station , and as far as the shale producers go , they have been saying for years now , and almost every quarter , how they have been able to reduce costs . How? The innovation that started their revolution in the beginning
So, those of you , who rely on some of these big boys? My advice: just a bit of common sense when you are reading this stuff and listening to those people. Force them to keep it simple , because it really is.