Oil at $58 in fear trade but expect it to drop to low $40s soon
In today’s “Future’s In Focus”, Todd Horwitz, chief strategist at Bubbatrading.com, and Bloomberg’s Vonnie Quinn examine the oil market. They speak on “Bloomberg Markets.”
OPEC oil prices on capital markets are going through a fear trade, fear of what’s going on in the Middle East, and in Saudi, said Horwitz.
He added that oil premiums are very narrow going into the future, so while there is a push to bring oil prices up, there is already a 200 year supply in the US, so no wiggle room for prices.
“There is a better chances for oil prices trading in the low 40s than in the upper 50s it is today, at nearly $58 a barrel. I see no reason for prices to go any higher,” he said.
“Rigs are back in the field pumping like crazy at these levels, but when Christmas is over we will see pressures on oil again.”