I think it might be a good idea to remind my readers of an article I wrote for Oilprice.com in march 2013. The big banks are already short a massive 40 billion dollar in oil, while the pension and savings funds are taking the other side of the bet. My take is that the oil price will keep falling in a highly volatile manner until it settles at a price where only the easy access reserves in the Mid East are profitable. I guess somewhere in the $20-$30 range.
The stabilizing trend of the oil price in the $90-100 range supported by the big banks is broken. As shown by CoT data, swap dealers have continously supported falling prices with intense buying. It seems that this strategy is now abandoned. We’ll see.