- The Wall Street Journal – Five Potential Risks to the Oil Rally
As sentiment on oil has turned positive, hedge funds and other speculative investors have amassed a record number of long positions—bullish bets on oil. If sentiment sours, these investors could quickly unwind their positions, driving prices down. “The rally may have gone too far too fast, and with current long positions being excessive, a temporary downward correction seems possible,” said ABN Amro’s Mr. van Cleef.
- Barron’s – Oil Could Hit $80 a Barrel This Year
Tightening global supplies and rising demand for crude oil helped prices for the commodity start the year with a bang—hitting their highest levels in more than three years—and many analysts believe the market has the fuel it needs to continue the rally to as high as $80 a barrel. “The reason that oil will soar is the oldest story in the oil world: Low prices created strong demand and growth, and now that demand is leading the way,” says Phil Flynn, senior market analyst at Price Futures Group. Oil futures suffered hefty declines in 2014 and 2015, as a global glut in supplies and the Organization of Petroleum Exporting Countries’ unwillingness to significantly curb production amid fear of market-share loss sliced the per barrel oil price roughly in half.
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