Energy expert Philip Verleger discusses in this Kudlow clip how oil price could briefly hit $20 a barrel, levels not seen in over a decade. Supplies have run for eight consecutive months at about 2M barrels a day [b/d]. That number, says Verleger, is higher than the global demand of 83M b/d.
Mr. Verleger argues that as oil supply continue to outstrip demand, its use will keep declining while the world economy remains in recession. Verleger also argues that storage facilities are filling and when tanks are filled there will be no place to put oil, forcing price to drop.
[via Carpe Diem]
