The price of oil keeps moving in one direction—down. Even political tension between Iran and Saudi Arabia (historically a cause of price rises) has not stopped the drop. It may come as a surprise to some, but it drives home the point that it is not politics but market fundamentals that set prices.
The global marketplace is awash with crude, thanks in part to U.S. shale, Russia pumping at its limits, OPEC countries incapable of agreeing to a cap on production, Saudi Arabia remaining in a fierce price war with U.S. shale producers, and Iranian stocks entering the market. Industry stocks are as high as almost ever before.
Clearly, oil assets are on the losing side and the future does not bode well for global oil.
