$25 crude would require a deflationary collapse and a reduction in demand of at least 40% worldwide. It would also require international calm.
I don't see all those lining up.
WORST CASE, $70 no matter how much we pump.
And, the producers are not dumb enough to produce TOO much. It's money in the ground for them. They can pump slower to milk every last dollar out of each barrel.
“They can pump slower to milk every last dollar out of each barrel.”
Why would anyone do it differently? They are in business to make money. Do you reduce your asking price just to be a nice guy?
The difference this time is natural gas may be substituted for gasoline. That’s started in several states including WV. At one point, the US used about 50% of the world’s oil. about 25% of that was produced domestically. If we attain energy independence that 25% of the world’s production will have to find other buyers. Any significant decrease in the oil will force some countries, like Iran, to pump additional oil to maintain enough income to maintain certain absolutes. As more oil floods the market, inventories will increase leading to further drops in price.
How far out can you buy futures? I think the guy has the trend nailed. Not sure about that much of a drop.