Morgan Stanley Economist Sees Oil Crash

The oil market may be quickly headed for a massive crash as global economic growth slackens, alternative energy gains ground and financial traders sense a price peak, an economist with Morgan Stanley said on Thursday.

His projection for a multi-year bear cycle stands in sharp contrast to the super-spike scenario envisioned three months ago by Goldman Sachs, Morgan Stanley’s arch-rival in the world of oil derivatives trading, where they are the two biggest players.

“As evidence of weakening demand and ample supply accumulates, the market may panic,” Andy Xie, Greater China economist in Hong Kong, said in a report. “I believe it could correct in the most speculative fashion — it could collapse.”
Reuters