Oil Very Cheap Relative to Other Assets, JPM’s Kolanovic Says
- Crude would need to hit $115 to reach historical median level
- Producers are subsidizing consumers in a way, strategist says
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While the top consuming nations are preparing to release oil from their national reserves to rein in rising prices, crude is actually cheap relative to other financial assets, according to JPMorgan Chase & Co.
Among global stocks, bonds and commodities, oil is in the 19th percentile over the last 20 years, and to rise to the 50th percentile relative to historical levels, it would need to be at $115 per barrel, strategists led by Marko Kolanovic said in a note Monday. West Texas Intermediate was near $76 on Tuesday.