The U.S. Government Just Poured More Cold Water on the Oil Market Recovery

The U.S. Government Just Poured More Cold Water on the Oil Market Recovery

The oil market hasn't recovered as much as most expected this year. One group that initially anticipated a slightly better market was the U.S. Energy Information Administration (EIA), which is the government agency in charge of collecting, analyzing, and disseminating information to help policymakers, the market, and the public understand what's going on in the industry. However, the EIA recently watered down its oil market outlook for 2017 and 2018, which suggests that it doesn't anticipate a recovery anytime soon.

In one regard, the EIA was mildly bearish on crude prices heading into 2017, especially compared to some Wall Street analysts. Overall, the government agency expected that the U.S. oil benchmark, West Texas Intermediate (WTI), would average $50.66 per barrel this year, while the global benchmark, Brent, would be about $1 per barrel higher. That forecast was a few dollars below the prevailing prices at the time.

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Source: Fool.com