The oil price crash has squeezed investment in the industry to the weakest levels in 30 years. Capital expenditure on global oil exploration and production is expected to fall 17% in 2016, following a 24% drop in 2015, according to the International Energy Agency's medium term outlook. "It is easy for consumers to be lulled into complacency by ample stocks and low prices today, but they should heed the writing on the wall: the historic investment cuts we are seeing raise the odds of unpleasant oil-security surprises in the not too distant future," said IEA Executive Director Fatih Birol on Monday. Oil prices plunged more than 70% over the past 18 months but have steadied in recent days. U.S. oil futures climbed 5.7% on Monday to trade above $33 per barrel. Freed from nuclear sanctions, Iran is expected to keep boosting production in the next five years, according to the agency's forecasts. The IEA sees Iran's output hitting 3.94 million barrels a day by 2021. The country pumped just under 3 million barrels a day in January. As for demand, markets will continue to pivot towards Asia, the report said. Indian consumption is expected to grow in the next five years, as more motorists take to the roads. Meanwhile, Chinese demand growth will cool in tandem with the economy, the agency forecasts.
Most of the people don't want to take risks, though I'm almost sure that oil will cost at least $45 by the end of the year.