Fueled by a bout of short covering, oil prices continue to climb towards $50 as some analysts now see more upside than downside.
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• Fossil fuels account for 81 percent of total U.S. energy consumption.
• The most significant development in recent memory is the dramatic downfall of coal in the electricity sector, the result of cheap natural gas, stricter environmental regulation and the rise of renewables
• Coal consumption fell almost 9 percent in 2016 alone, after dropping 14 percent in 2015. Coal consumption is down 38 percent since 2005.
Tuesday July 4, 2017
Oil prices continued to rally, retracing a good chunk of the losses made over the past month. Brent is flirting with $50 oil while WTI has moved above $45. The gains have largely been attributed to a spate of short-covering, but the gains have damped down some of the panic that the market suffered from two weeks ago.
Oil has more room on upside than downside. Even as oil entered bear market territory only recently, a growing number of analysts see the selloff as going too far. Now some argue that there is a better chance of more price gains than there is in another downturn. The logic is the same as it was earlier this year: despite short-term volatility, the market is still heading towards balance, even if that is occurring at a painfully slow pace. “We thought this market was actually a bit oversold. We think the fundamentals are better than where the price was earlier,” Helima Croft, global head of commodity strategy at RBC Capital Markets, told CNBC. Other analysts agree. "Given that all these bearish headlines have been priced into the market, if you're going to have any sort of risk of a large outside move, I think it would be to the upside at this point," Stephen Schork, editor of The Schork Report, said to CNBC.