The Times: Oil prices to fall to $20

Oil prices can hit a 20-year low.

Oil prices can drop $20 a barrel as Gulf producers stood firm on their plan to turn the screws on shale drillers in the United States.

Crude prices can hit a 20-year low of $20 a barrel, RBC quotes The Times.

According to Nymex, the New York exchange, the number of contracts or options to sell US crude at $US20 in June has jumped from close to zero at the beginning of the year to 13 million barrels of oil. The data shows how the outlook for prices has deteriorated in a month.

On January 13, the price of Brent fell to a near-six-year low of $45.19 and traded below WTI for the first time since July 2013, journalists write.

Analysts said the discount on Brent reflected Europe’s weakening economy and expectations that the US ban on crude exports, in place since the oil crisis of the 1970s, would be loosened.

Goldman Sachs, one of the most influential banks in commodities markets, significantly cut its forecasts for oil prices by $20-33 on January 12. The bank's analysts forecast that Brent will cost $50.40 a barrel in 2015 and $70 in 2016 (against $83.8 and $90 respectively). US WTI crude is expected to trade at $47.1 in 2015 and $65 in 2016 (against from $73.8 and $80 respectively).

Bank of America Merrill Lynch forecasts Brent crude will fall to $40 a barrel in the near term. Analysts say it will make either Saudi Arabia or non-OPEC countries cut production.