Source: Trading View
As oil prices declined, there have been numerous predictions that prices will recover in the past 18 months. However, we had not seen a meaningful recovery. The nearest we had was the double-bottom recovery in early 2015 as the US experienced a harsh winter (more demand for energy for heating) and on expectations of a strong US recovery. This quickly faded in the second half of 2015 as the US recovery was not as strong as predicted and China experienced the first of its many equity meltdowns in June 2015. So ......In this article, we are going to look at the causes behind the 74% plunge in oil prices from a peak of $106.78 per barrel in June 2014 to a low of $27.10 on January 20.
In order to give you an “appreciation” of the oil plunge, let’s have to look at the chart:
