EIA lowers forecast for crude prices

It seems when it comes to crude there is no end of bad news for now. US's Energy Information Administration (EIA) lowered its forecast for crude oil prices, sharply from last month's estimate.

• According to EIA, WTI prices are likely to average $49/barrel in 2015, down $6/barrel from last month's forecast and $54/barrel in 2016, down $8/barrel from previous forecast.

EIA is sighting slowdown in emerging market, continuing supply growth, rise in global inventory and return of Iran in crude oil market as the primary reason for revise in forecast along with drop in crude prices.

In 2015, Brent crude has traded at a premium of average $5/barrel and EIA expects it to continue further in 2016.

EIA, also pointed to a high level of implied volatility of 37%, compared to 16% at same time of the year. However in Dollar terms it may not be much given the lower price of oil compared to a year ago.

WTI is currently trading at $42.7/barrel and Brent with $5.9/barrel premium.