Oil hits new low as Opec price war deepens slump

[Chef Ramsay]

Oil prices touch five-and-half-year lows amid concerns over oversupply and weakening demand for crude

Oil now being stored at sea on tankers amid global oversupply

Brent crude plunged below $57 per barrel briefly on Tuesday, marking a new five-and-a-half-year low as traders bet that the global oversupply of oil will continue deep into 2015.

The benchmark has fallen more than 45pc since June and is on track for its worst year since 2008, while oil traded in the US is now poised to crash through the $50 per barrel level.

"Oil bulls are having another hard week as Brent oil dropped to $56.90, a new five-year low, as lingering worries over supply excess overwhelmed fear of Libya supply disruptions," said Peter Rosenstreich, head of market strategy at Swissquote.
Crude prices have plummeted since the Organisation of Petroleum Exporting Countries (Opec) agreed in November to leave its production quotas unchanged at 30m per day, effectively triggering a price war with producers outside the Middle East-dominated cartel.

Opec countries led by Saudi Arabia - which pump a third of the world's crude - are concerned about the loss of market share to shale oil drillers in the US and ballooning supply outside the group.

More...http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/11317216/Brent-oil-hits-new-low-as-Opec-price-war-deepens-slump.html

[contagion]

$57 by Dec. 31, exactly as Armstrong had predicted...

Massive global deflationary collapse underway!

We are heading back to retest the $35 levels of the 2008 deflationary episode, except this time QE can't come to the rescue!

Even China can't stimulate this time.

The fat lady has sung. We are in the 9th inning and the game is over. Massive collapse dead ahead. Europe and Japan will collapse in 2015, and the USA will top out in October then collapse into 2016. We will be in global deflationary chaos by 2017 or so.

http://armstrongeconomics.com/2014/12/29/crude-oil-in-the-grips-of-massive-deflationary-cycle/

http://kwout.com/cutout/h/ck/7q/s2u_bor.jpg

Our original forecast for oil back in 1997 was that it should rise to reach the $100 level at least by 2007. We reached $99.29 in 2007 and then 2008 was a wild trading year reaching $147.27 intraday crashing back to $35.13 and closing the year at $44.60. Oil made the intraday low in 2009 and then rallied back into 2011 to score the highest yearly closing at $98.83. We can see from the chart above back to 1902, the rally from the 1998 low was a perfect 13 year event. We warned that a year-end closing BELOW $57 will signal a sharp decline should continue. It certainly appears that will be accomplished and then we will look for a retest of the $35-$31 level. We see a Panic Cycle ahead on our yearly models as well. Overall, this is part of the meltdown for BIG BANG. There is not going to be much left standing as every field of investment and economy should be hit rather hard. We will be looking at putting out a special report on Energy for this is part of the massive global deflationary cycle underway.

And another of his bearish predictions is hitting exactly to the day!

http://armstrongeconomics.com/2014/12/30/yearly-bearish-in-euro-121-56-woe-is-europe/

Yearly Bearish in Euro 121.56 – Woe is Europe

The fear of a resurgence of the Euro Crisis has weighed on the common currency driving it down sharply trading at 1.2156 at 6:05 EST. The euro fell to $ 1.2122 intraday, marking the lowest level in two and a half years. However, our Yearly Bearish Reversal is 1.2156 precisely where we are trading at the time of this update. A [yearly] closing beneath this area will bring all our forecasts into being.

[panju1]

This is real good news for a lot of countries which import oil.
Precious foreign exchange gets saved. 

[contagion]

This is real good news for a lot of countries which import oil.

Incorrect.

[CoinCube]

$57 by Dec. 31, exactly as Armstrong had predicted...

A useful data point if it can be confirmed. He predicted this when exactly and where. The two links were posted on December 29th and December 30th.

[contagion]

$57 by Dec. 31, exactly as Armstrong had predicted...

A useful data point if it can be confirmed. He predicted this when exactly and where. The two links were posted on December 29th and December 30th.

Review my posts. I saw one a few minutes ago that I quoted from Dec. 17 (see link below), but I remember him writing that when oil first started to decline in November.

Incorrect.

The Euro prediction has been in place for more than year.

As well the oil predictions have been in place for decades, which can be confirmed by obtaining a copy of that oil report he mentions from a decade ago.

[JessicaSe]

i think it will recover very soon
i think most countries are increasing their stock for future as much as they can for this cheap price
i wish we will see 60$ mark again in jan 2015

[contagion]

i think it [oil price] will recover very soon

Incorrect.

The global economy is collapsing. And QE can't be effective again, because the marginal-utility-debt has gone negative globally (not just in the USA).

This is it folks. We are staring into the abyss. Over the cliff we go! BOHICA.

And you all are not ready.

Even the fastest growing economy is the world is starting to tighten monetary policy.

[bryant.coleman]

This is real good news for a lot of countries which import oil.
Precious foreign exchange gets saved. 

Yes. Good news for China, India, Japan, South Africa.etc.

I think the Japanese will be the most happy.

[contagion]

This is real good news for a lot of countries which import oil.
Precious foreign exchange gets saved.  

Yes. Good news for China, India, Japan, South Africa.etc.

I think the Japanese will be the most happy.

Won't help them avert a massive collapse (India may be an exception).

The significant impact of the falling oil price is it indicates the global economy is collapsing and it will set off a derivative chain reaction contagion due to the $trillions of derivative contracts written when oil was $100. Which will cause banking insolvency, which will cause a need for more bailouts, but this next time the plan is to take the bailouts directly from the bank depositors, which will be massively deflationary.

[Window2Wall]

i think it will recover very soon
i think most countries are increasing their stock for future as much as they can for this cheap price
i wish we will see 60$ mark again in jan 2015

I doubt this. Falling oil prices are an indication of weak economic growth (and potential future negative economic growth). Energy prices falling this much could very well be a leading indicator of a pending recession which would cause even more pressure on energy (including oil) prices