WTI crude oil futures were trading about $42.6 per barrel and touched a six-year low Wednesday while Brent crude oil futures were hovering around $54.3 per barrel. Bentek Energy, a sister firm to S&P Capital IQ, projects WTI crude will average $41 per barrel and potential dip below $40 per barrel this year, but average $48 in 2016.
Rising supply continues to weigh on the oil market. Storage at Cushing, Oklahoma is quickly filling up, with the facility at about 70% capacity, compared to 25% a year ago.
“As long as we stay in contango, and as long as there’s still additional storage capacity to fill, I think those numbers are going to continue to fill and I think it’s going to be keep putting downward pressure,” Glickman added.
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Max Chen contributed to this article.