Try Looking At The Chart
For over a year I have been posting that oil prices topped around the Russian move into Ukraine and the chart was telling you, the direction was down. Over this past year there have been numerous calls by so called experts, Wall Street firms and gurus calling for a spike back to $100 and some clowns calling for $200. I understand energy firms, Opec members, Wall street bankers etc. talking their books, but can’t anyone read a chart? Lets talk narratives. Those who try to talk up the oil price use various narratives to justify these ludicrous calls, if you want to go by narratives, the only one that matters is, the economies of the world are slowing. Central banks across the globe have raised interest rates for over a year and economic activity has nowhere to go but down. It was abundantly clear shortly after the sanctions on Russia that it’s oil was fungible and still adding to global supply.(something I pointed out in my posts at the time) By the time the world recovers from this economic decline(years from now) whatever growth eventually gets back to isn’t going to offset all of the demand destruction from EV’s, solar and other alternatives, improved mileage on remaining gas engines, less driving with hybrid work from home jobs etc. All the trends are towards less use of fossil fuels going forward. The chart says the two year rally from the Covid low to the Ukraine high will likely result in a two year fall back to somewhere between $40-$50. Not a prediction, but quite possible, as the economy is just starting to reflect the severe slowdown that is coming. The actual bottom will be determined by how long the downturn lasts. Just look at the chart and forget the narratives.