Will oil prices rebound in 2015

Oil prices suffered in the second half of 2014, dropping to below $50 a barrel earlier this week compared to north of $100 a barrel just six months ago. There have been many factors that have led to tumbling prices for the commodity but the most significant has been its oversupply. Shale oil production was significantly ramped up in the US last year and this – paired with increasing exports from members of the Organisation of Petroleum Exporting Countries – led to oversupply. Where the initial expectation was that OPEC members such as Saudi Arabia and Qatar would cut back production in order to drive prices up; however, this was not the case. Instead such countries maintained production levels in an attempt to lure custom away from the US shale market, at no small expense to profits.

Fortunately, oil prices appear to be stabilising and, while some predict that oil could reach as low as $20 a barrel by the end of the year, there are analyst who predict that 2015 will see oil return to more familiar levels. The question is, with global production seemingly unchanged what factors could lead to a rebound in this much talked about commodity?

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Spread Co
Providing market news and insights to support your trades, Spread Co is a leading online provider of Contracts for Difference (CFDs), Spread Betting and Forex. Trade thousands of global markets including indices, equities, commodities and currency pairs with tight, fixed spreads, low margins and low trading costs. Visit www.spreadco.com for more information. Leveraged products carry risk.

Spread Co

Providing market news and insights to support your trades, Spread Co is a leading online provider of Contracts for Difference (CFDs), Spread Betting and Forex. Trade thousands of global markets including indices, equities, commodities and currency pairs with tight, fixed spreads, low margins and low trading costs. Visit www.spreadco.com for more information. Leveraged products carry risk.

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