Fear Will Drive Oil Prices Higher In 2018

6 Dec 2017   Prices

The price of oil has always been driven by cycles of fear and complacency. During the cycle of fear, geopolitical events can send the price of oil soaring. During the cycle of complacency, oil prices will fall on bad news (e.g., the appearance of too much supply or weakening demand), but often seem immune to bullish news. Over the past decade, the world has experienced both cycles. The Cycle of Fear A decade ago “peak oil” was helping drive the fear cycle, as many credible voices asserted that a terminal decline in oil production was imminent. For a while, it looked like they might be right. Production in Saudi Arabia remained flat even as global demand continued to grow, and oil prices skyrocketed above $100 a barrel (bbl). These were just the types of consequences predicted by those who predicted an imminent terminal decline. But the reality was that […]

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