All Posts Tagged: oil prices

U.S. Outlook: What’s behind the oil price plunge?

Scott Anderson
Chief Economist

Crude oil prices had been generally rising in 2018 before peaking at $76.24 on October 3.

Large, very clean refinery at dawn. No human activity is visible.Since then, there has been a sudden shift in underlying market dynamics. What’s behind the sharp change in trend?

For more on this, see highlights of my report below, followed by a link to the full U.S. Outlook, delivered on Nov. 30.

Key observations:
  • Overall, we believe the increase in oil supply rather than a decrease in oil demand is the primary driver of lower oil prices today.
  • The sudden, sharp, and sustained decline in oil prices immediately reduced the inflation expectations of bond investors.
  • Investors are now expecting lower consumer inflation over the next five years compared to early October, largely as a result of the dramatic plunge in oil and other commodities prices.
  • Bank of the West Economics expects West Texas Intermediate Crude to average $62.50 per barrel in the fourth quarter, and average just $51.50 per barrel in 2019.

Read my full report.

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Investment Insights: Fret or fundamentals?

Wade Balliet
Posted by Wade Balliet
Investment Strategy
Photo of oil tanker and rig with stock market figures lightly superimposed over it.

Many investors are worried that the precipitous slide in crude oil prices signals a possible slowdown on a global scale.

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Investment Insights: Earnings are ripe and Tesla smells musky

Wade Balliet
Posted by Wade Balliet
Investment Strategy
Black Tesla Model S electric car at a Tesla supercharger changing station.

Stock markets are nearing all-time highs again as the surge in earnings continues.

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U.S. Outlook: What will the oil price spike do to consumer inflation?

Scott Anderson
Chief Economist
Oil rig and snow

Scott Anderson considers how Mideast tensions & rising oil prices may influence the Fed in 2018 and 2019.

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Investment Insights: What is the 800-pound hawk in financial markets?

Wade Balliet
Posted by Wade Balliet
Investment Strategy
Federal Reserve building at dusk

Investors have continued to grapple with the double-edged sword of a strengthening economy.

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