Oil prices have crashed to below $30-a-barrel amid warnings the rout could reach as low as $10 and bring down petrol prices to levels last seen in 2009. Standard Chartered became the latest major bank to downgrade its oil outlook to $10, joining the likes of Goldman Sachs, RBS and Morgan Stanley in making ultra-bearish calls as prices have collapsed by 15pc this year. Brent crude has now slipped to a fresh 12-year low of $30.41 a barrel, while West Texas Intermediate – the US benchmark – is trading at $29.93 – a level last seen in December 2013.
Analysts warned the oil market remains fundamentally out of balance as record over-supply and stagnant demand weighs on traders. Standard Chartered said there was no bottom in sight until “money managers in the market conceded that matters had gone too far”. “Given that no fundamental relationship is currently driving the oil market towards any equilibrium, prices are being moved almost entirely by financial flows caused by fluctuations in other asset prices, including the dollar and equity markets,” said Standard Chartered. FULL REPORT