US is Doing Something 'ExtraOrdinary' with Crude Oil

CNBC.COM- Tom Kloza of the Oil Price Information Service is alluding to the U.S. ramping up exports. It follows the 40-year ban that was lifted two years ago.

"The highlight you need to watch for the next few months is going to be more record breaking exports of crude oil. Our view is that it's going to soften the price for Brent," the firm's global head of energy analysis said recently on CNBC's "Futures Now."

According to Kloza, it's possible the U.S. will export 15 million to 20 million barrels of crude a week to several continents.

"That's something we've never seen before," he added.

Kloza, who accurately called the 2015 oil collapse, says it's unclear how the phenomenon will affect the global markets, but he doesn't expect a breakout to the downside.

"If you consider what happened in Iraq and the saber rattling about the Iran nuclear deal, the market barely moved. So, it may be a little biased towards lower prices," Kloza said.

He's predicting Brent will be stuck in a $54 to $57 a barrel range for the rest of the year while WTI crude will hover around $47 to $51. That's near current levels.

"The interesting thing is when you get to 2018, we're expecting a tale of two markets. Weaker prices in the first half with maybe some more inventory builds worldwide, and stronger prices in the second half of 2018," he said.

And when could crude oil see $60 a barrel again?

Kloza said probably not until 2019.

Courtesy: www.cnbc.com