The oil price today (Tuesday) fell below $50 for the first time in three trading sessions. The decline came after the International Energy Agency (IEA) warned oil prices may stay down as stockpiles increase.
By late afternoon, WTI oil prices dropped $3, or 5.7%, to $49.86. WTI futures had climbed nearly 9% over the past three trading sessions due to declines in drilling activity. Brent crude prices were slightly less volatile today, falling $1.91, or 3.3%, to $56.43.
The IEA's announcement contained plenty of bad news for the oil price today. It said oil supplies held by the 34 countries in the Organisation for Economic Cooperation and Development, including the United States, may come close to 2.83 billion barrels by mid-2015. According to CNBC, that would be a record high for the OECD.
That level hasn't been seen since 1998, when the oil price sank to an average monthly low of $11.22 per barrel.
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The agency said the global oil market could be out of balance for years due to U.S. shale production.
But, as Money Morning Global Energy Strategist Dr. Kent Moors reiterated today, there's a lot more to this oil story that points to price rebound in 2015...
Why Experts Aren't Worried About Oil Prices Today
"Oil is very near a bottom," Dr. Moors notes. "As the most fluid commodity in the world, crude has the ability to quickly self-correct, which is why long-time oil veterans aren't worried about falling oil prices."
Dan Greenhaus, chief global strategist of BTIG LLC, also shed positive light on oil's market impact via Twitter:
Moors just updated readers today on how analysts have it wrong about oil. Find out why Citigroup's recent $20 oil price prediction is drastically off the mark...
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