How low can the oil prices plunge?

As we know now oil prices is at its bottom low…at 30USD per barrel. So you may wonder how low it can go more?

On 2015, when we talked about 30USD per barrel, traders like us know it is impossible as there will be a lot of supporting factor to support once the oil prices drop below 40USD per barrel. But end of 2015 when close to FOMC annoucement of interest rate, suddenly the oil prices plunge below 40USD and all the way to 35USD. Beginning of 2016, oil prices break 35USD support and straight away tested 30USD support in two weeks time.

Today when i write this article, the oil prices already plunge close to 29USD, testing support at 29.

So back to the question, how low can the oil prices plunge till?

Let see the picture below to understand historial price of oil.

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If we trace back to Dec 1998…the oil prices is at the lowest which is 16.33USD…

The closer one to current bottom is 2001 which is at 25.96USD…

One interesting to take note is during the lowest bottom of each oil prices, the timeline is very close to financial crisis…

So back to where we start, what do you think is the lowest bottom of the oil price this time?

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