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( Fundamentals point toward market balance but pessimism is dragging oil prices down. IEA has apparently succumbed to this negativity but their data suggests that things are getting better, not worse.

In a business-as-usual world in which nothing unusual happens, the world will be close to market balance some time in 2016. If anything unusual happens, all bets are off and oil prices could rebound much faster than anyone imagines.

Just to be clear, I continue to believe that oil prices must fall further in order to modify producer and capital-provider behavior and thus prepare the way for some kind of meaningful market balance to occur and I don’t see that happening any time soon.

Fundamentals are moving slowly in the right direction toward market balance. Imbalance will persist for some time and a meaningful price rally—that is not taken away when reality forces its way back upon the markets—cannot occur unless/until supply and demand are approaching balance.