Moe Zulfiqar: Since September 2013, crude oil prices have come down. This has left many investors question where they are headed next. In September of last year, crude oil prices reached as high as $110.00, and now they trade almost 15% lower, around the $94.00 level. Look at the chart below to get the precise picture.
Chart Courtesy of StockCharts.com
When it comes to commodity prices, whether it’s wheat, copper, coffee, or crude oil, supply and demand affect them significantly. Recently, there have been some changes in the global arena that suggest crude oil production will increase.
First off all, thanks to fracking, there’s an oil production boom in the U.S. economy. Due to this, there have been reports suggesting that the U.S. will become energy independent when it comes to its oil needs, even becoming an exporter a few years down the road.
Then, Iran, once a major oil-producing nation, came under heavy sanctions due to its nuclear program. Recently, the country came to an interim deal with the West and, as a result, the restrictions it has faced may be removed and there may be more crude oil on the markets. Before the sanctions, Iranian exports of crude oil amounted to 2.5 million barrels per day. They now stand at one million barrels a day. (Source: Saefong, M.P. and Lesova, P., “Nymex oil cuts loss; Brent nearly recovers,” Market Watch, The Wall Street Journal, November 25, 2013.)(...)Click here to continue reading the original ETFDailyNews.com article: Expect A Decline In Crude Oil PricesYou are viewing an abbreviated republication of ETF Daily News content. You can find full ETF Daily News articles on (www.etfdailynews.com)