Oil Rally Seen Reversing as Rising U.S. Supply Deepens Glut
Is the U.S. Oil Production Boom Over?
This article is for subscribers only.
The rebound in oil will reverse because rising U.S. production is deepening the global supply glut, according to UBS AG, Bank of America Corp. and Commerzbank AG.
Brent futures entered a bull market this month as U.S. drillers stopped using a record number of rigs, companies cut at least $40 billion from spending plans and hedge funds turned the most bullish in seven months. None of that will stop Brent slipping back to $45 a barrel or lower within the next three months, from about $61 now, the banks’ analysts say. Prices fell as low as $45.19 on Jan. 13.