“The decline that we experienced today is all out of measure to what it is that the market is actually telling us,” Kent Moors, executive chair of Money Map Global Energy Symposium, said Monday. “I think that this is more in terms of a psychological collapse, more than anything else.”
In an interview with CNBC’s “Closing Bell,” Moors forecast oil prices to hit between $75 and $85 a barrel by the end of the year. “Demand, when all is said and done, for this year will come in higher than at any point OPEC or IEA has ever calculated,” Moors said.
He cautioned, however, that it will take some time for crude prices to recover from what he called a “triple whammy,” referring to Greece’s debt referendum, Beijing’s intervention in its stock markets and oversupply fears related to Iran.
West Texas Intermediate closed down 7.7 percent at $52.53 a barrel.
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Adding to the pressure on oil markets, Iran and global powers were trying to meet a July 7 deadline on a nuclear deal, which could add more oil to oversupplied markets if sanctions on Iran are eased.
Of the headwinds, Moors said the Iranian situation is the least serious.
“If we had an agreement tomorrow, there won’t be any appreciable Iranian additional volume in the market for at least 18 months,” Moors said. Oil falling on news related to the nuclear deal “is a perceptual thing, but it has no substance.”
Looking forward, Moors said oil demand is increasing internationally. He said the bulk of the demand is moving toward Asia, a trend he expects to continue until 2035.