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The price of oil collapsed and bounced off low support in a near-perfect fashion. What’s next?

Here is their view, courtesy of eFXnews:

ABN AMRO Research discusses the drop in oil prices noticing that oil prices dropped significantly in the past days as a result of Libya’s and Nigeria’s increase in production which has raised concerns that the rebalancing of the oil market could take much longer than anticipated.

“This drop in oil prices followed last week’s tensions surrounding Qatar, which triggered market speculation that OPEC would not stick to its production cut agreement. On top of that, financial markets are still concerned that US inventories could remain at record high levels for longer than anticipated,” ABN AMRO adds.

“We expect both Brent and WTI oil prices to recover towards USD 60/bbl. At this moment, we see no strong argument to lower this forecast based on the current negative market sentiment,” ABN AMRO argues.

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