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Will the 1986 Crude Oil Price Collapse Repeat or Could It Be Worse? (Continued from Prior Part) Price channel
September WTI (West Texas Intermediate) crude oil futures contracts fell for the fourth consecutive trading session. Oil prices are trading in a downtrend channel. Prices have been fluctuating within this downtrend channel since the last week of June 2015. Global oversupply concerns and the consensus of falling US crude oil inventories are driving crude oil prices.
Key pivots
The bearish momentum could drag crude oil prices lower. The nearest support for crude oil prices is seen at $44 per barrel. Prices hit this mark in March 2015. The ample supply concerns, record inventories, speculation of slowing demand, and the appreciating US dollar could drag WTI (West Texas Intermediate) prices lower. In contrast, the long-term lower crude oil prices could support WTI prices. The next resistance for WTI prices is seen at $55 per barrel. Prices hit this level in July 2015.
The crude oil price chart suggests that prices could fluctuate between $46 and $50 per barrel in the near term. Goldman Sachs forecasts that US crude oil prices could hit $45 per barrel in October 2015—led by oversupply concerns and the strong dollar. Morgan Stanley expects that we could see a crude oil market collapse that’s worse than the 1980s—if Saudi Arabia and Iraq keep pumping crude oil to record levels, Iran gets back to its peak production before the oil sanction, and Libya improves its output.
All of these factors could lead to crude prices possibly trading below $60 per barrel for the next three years. Societe Generale estimates that even if the global oversupply concerns and seasonal weakness are priced in the next couple of months, there isn’t a clear catalyst to drive crude oil prices higher in the short-term.
ETFs like the VelocityShares 3X Long Crude ETN (UWTI) benefit from rising crude oil prices. In contrast, long-term lower crude oil prices benefit ETFs like the ProShares UltraShort Bloomberg Crude Oil (SCO).
Energy producers like Pioneer (PXD), Noble (NBL), and ConocoPhillips (COP) are also impacted by falling crude oil prices. They account for 7.65% of the Energy Select Sector SPDR ETF (XLE). These stocks’ crude oil production mix is greater than 41% of their total production.
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Noble Energy
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CODE : NBL |
ISIN : US6550441058 |
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ProfileMarket IndicatorsVALUE : Projects & res.Press releasesAnnual reportRISK : Asset profileContact Cpy |
Noble Energy is a producing company based in United states of america. Noble Energy is listed in United States of America. Its market capitalisation is US$ 4.9 billions as of today (€ 4.1 billions). Its stock quote reached its highest recent level on May 09, 2008 at US$ 97.39, and its lowest recent point on August 31, 2020 at US$ 10.00. Noble Energy has 492 191 992 shares outstanding. |