Publications: Notes at the Margin

The Mirage of Higher Prices (June 20, 2016)


Current oil prices are not supportable. They could be in time but not today. The recent increase has been fueled by the global supply disruptions, primarily the one caused by forest fires in Canada. As these pass, the data say prices will fall back to lower levels, probably the mid-thirties. The world's high inventories prompt this conclusion. Globally, commercial stocks are far too plentiful to maintain current prices absent ongoing disruptions. In this report, we present evidence for the impending price decline. 



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