Oil Falls Below $80 For First Time in More Than Three Months
Speakers
Mike McGlone
— Senior Commodity Strategist, Bloomberg Intelligence
Summary
Bloomberg's Mike McGlone discusses the drop in Brent oil below $80 and argues crude oil will fall to around $50 by year-end, driven by Trump's need for lower energy prices, midterm election dynamics, and the low price cure. He also expects gasoline to slide toward $2 after the driving season, dismissing SPR refilling as a bearish factor.
- Brent oil fell below $80 for the first time in over three months amid US-Iran deal hopes.
- McGlone sees Trump needing lower energy prices by midterms, pressuring crude.
- He forecasts crude oil could drop to near $50/barrel by year-end.
- Natural gas already led the way down, foreshadowing oil's decline.
- Gasoline prices are expected to fall toward $3 and potentially below $2 post-driving season.
- The low SPR level is seen as a bearish factor because the US has surplus supply and no longer needs a large reserve.
Ideas
Crude oil to $50 by year-end
Crude oil prices will decline significantly, potentially to around $50/barrel by year-end, driven by President Trump's need for lower energy prices ahead of midterm elections, midterm election year stock market weakness that pressures crude, the tendency of high prices to bring on more US supply, and the 'low price cure' dynamic where high prices eventually cure high prices, as natural gas already led the way down.
Gasoline heading toward $2 after driving season
Gasoline prices will decline through the driving season toward $3/gallon and potentially below $2 because seasonal patterns historically press prices lower after the driving season pump, and futures already point to $3.80, with the typical 'stairs down' price action after a spike.
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Speakers: Mike McGlone · Tickers: WTI, UGA