A quick review of the fundamental year over year oil data is the US is producing approximately 723,800 barrels less oil per day than last year.
The total active oil rigs in the US and Alaska is down by more than 50%, but our stockpiles have risen 75M barrels over last year. It doesn’t take an economics degree to deduce that the US market has experienced some demand destruction over the last year.
The normal by-product of this sort of supply/demand equation is price should fall to wherever equilibrium is and the equation becomes balanced. In short, the year over year data is clear, price should continue to fall to eventually balance out.
