- March 1, 2016: Vol. 3, Number 3

To read this full article you need to be subscribed to Real Assets Adviser

The Lowdown on Low Oil Prices: More economic stimulus and less pain than many observers realize

by Jeffrey Havsy

The oil supply glut has deepened these past few weeks since OPEC decided not to restrict crude production, citing expectations for an expansion in global demand of 1.3 million barrels per day in 2016 alongside a contraction in non-OPEC supply. In the United States, mild weather and still-elevated unconventional production are contributing to the market’s oversupply, depressing prices.

Crude prices recently dipped below $40 per barrel for the first time since February 2009; they likely will remain at or below that level for the next six months. Looking ahead, the December congressional vote to lift the four-decade ban on U.S. crude exports could open new markets to domestic producers and improve price parity between the West Texas Intermediate and Brent indices; however, the legislation is not expected to result in higher prices.

According to the U.S. Energy Information Administration, lower gasoline prices were expected to have saved the average household $700 in 201

Glossary, videos, podcasts, research in the Resource Center

Forgot your username or password?

Close your account?

Your account will be closed and all data will be permanently deleted and cannot be recovered. Are you sure?

We respect your privacy! Please give consent for processing data as described in our Privacy Policy