US predicts decline of Brent oil price to $40.00 in the near future

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An oil drill is pictured in the Kern River oil field in Bakersfield

During a short-term period Brent oil price will drop to $40.00 per barrel, leaving the exporters, including Saudi Arabia, no other choice, than to reduce production, reported Reuters referring to Bank of America Merrill Lynch.

The experts believe that cost of US WTI oil will drop to $35.00 per barrel. Therefore, Saudi Arabia or non OPEC member-states will have to reduce production, said the same source.

Bank of America Merrill Lynch mentioned that the oil market could feel the bottom, only if the OPEC member-states limit the deliveries and members of the OPEC will reduce production and the global demand will increase. However, none of these claims have been met yet.

On January 7,l 2015 first time since May 2009 Brent oil price went down below $50.00 to $49.66 per barrel.

Walter Zimmerman from the Unite ICAP company, who predicted reduction of oil prices in 2014, said further reduction of oil prices will be a very emotional decision having nothing to do with demand and supply. He added that if the prices go down below $39.00 per barrel, then they will reach $30.00 per barrel, reported Bloomberg.

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