The Energy Space
Energy Price Outlook
Look for the slow drift lower to continue in the near-term, as worries about the health of the economy and the fiscal cliff dominate. Stocks sold off yesterday on various corporate and European news items, but closed near the bottom of last week's trading range as well as close to a new four-month low. We believe that markets are re-pricing risk as well as exiting markets before the end of the year, and should continue their drift lower until any sign of progress is made either on the fiscal cliff or the economy. This should translate into lower energy prices, where we think WTI could reach $80/bbl. Fundamental pressure will come from the IEA's downgrade of global demand yesterday and elevated levels of U.S. oil production and inventories. Support will be offered by improved Chinese oil imports and reduced shipping rates in the Keystone Pipeline. API data will be released this afternoon due to Monday's holiday. We would trade the oil market as a negative affair in the near-term....1976 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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