U.S. oil prices of around $20 per barrel could still happen, Citigroup’s Ed Morse, said Thursday as crude briefly hit 12-year lows of just over $32 per barrel.
“You never know where the bottom is,” Morse told CNBC’s “Squawk Box.” He said the recent tumble has been more severe than he’d anticipated. “We think the pressure is still going to be on for lower prices,” he added.
West Texas Intermediate crude was falling around 3 percent early Thursday, after a decline of 5.5 percent on Wednesday.
China’s stock rout this week sparked new concerns about a slowdown in the world’s second-largest economy and what that might mean for global oil demand at a time of near-record production and massive crude stockpiles.
“The market is itself much more fragile than the price of oil would indicate,” said Morse, Citi’s global head of commodities research. He added that any supply disruptions due to political uncertainty in Venezuela, Nigeria or Iraq, for example, could just as easily send oil prices higher.