WTI Crude Craters To $55 Handle, High-Yield Credit Crashing-er – Goldman Pours More Crude On The Fire: “Oil Prices Can Go Lower For Longer”

WTI Crude Craters To $55 Handle, High-Yield Credit Crashing-er (ZeroHedge, Dec 15, 2014):

Having almost touched $59 overnight, WTI crude has collapsed back to a $55 handle, smashing the Ruble lower and high-yield credit spreads higher. US financial stocks are starting to weaken back towards the credit market’s warnings as counterparty risk concerns spread…

Goldman Pours More Crude On The Fire: “Oil Prices Can Go Lower For Longer” (ZeroHedge, Dec 15, 2014):

Slowing the rebalancing and creating further downside risk is a very strong consensus view that this pull back is temporary and that oil prices will quickly rebound as they did in 2009. According to a recent Bloomberg survey, the median WTI forecast for 2016 is $86/bbl (even we forecast it going back to $80/bbl). All of these forecasts are based upon now outdated cost data that is shifting as fast as the price. It is precisely this strong view for a rebound in prices and the behavior it creates, that not only suggests that oil prices can go lower for longer, but also that the new normal is far lower than we thought just one month ago. Instead of optimizing against a lower price environment, many oil producers are trying to position themselves for the rebound in prices

 

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