Oil could fall below $30 a barrel, but here’s why that’s a good thing

30-Mar (MarketWatch) — Oil futures could tumble as far as the mid-$20s before bottoming. But if history is a guide, that could be a positive scenario for stocks as corporate earnings and consumers reap the benefit of lower energy prices, said Scott Minerd, global chief investment officer at Guggenheim Partners.

But first, Minerd sees little reason to expect a significant near-term rebound for oil prices.

The supply-demand dynamics remain decidedly unfavorable, he said in a meeting with reporters Monday, particularly with storage capacity at the Cushing, Okla., delivery hub likely to run out in coming weeks. That will put even more crude on the spot market. He also isn’t convinced rig counts have fallen far enough to stop U.S. oil production from rising.

[source]

Share
This entry was posted in Today's top gold news and opinion. Bookmark the permalink.