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Oil unlikely to return to $100 a barrel for years

Move would take major change in Saudi policy: Tom Kloza

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Oil won’t see $100 for a long time, says OPIS’s Tom Kloza.

Traders said goodbye to $100 oil prices a little over a year ago, and they might be staying away even longer than some expect.

West Texas Intermediate crude-oil prices won’t likely climb back to $100 a barrel this year, or next, according to Tom Kloza, global head of energy analysis at Oil Price Information Service.

‘Generally, it is difficult to make a case for $100 a barrel oil through the next few years.’
Tom Kloza, Oil Price Information Service

“Anything beyond the realm of the next 18 months smacks of witchcraft rather than real analysis,” he said in an email interview. “Generally, it is difficult to make a case for $100 a barrel oil through the next few years.”

Kloza sees a more realistic range between $40 and $60 a barrel for monthly WTI averages over the next 15 months.

“Anything north of $60 a barrel brings a return of drilled-but-uncompleted shale wells, and anything south of $40 a barrel probably inspires cuts in some of the larger domestic and overseas projects,” he said.

Oil prices have dropped more than 50% from their peak in the summer of 2014, pressured by a global glut of supplies and concerns about a slowdown in energy demand from China.