Low Interest Rates Mean Cheap Oil Is Here to Stay

Oil prices peaked at over $100 a barrel in mid-2014 before falling sharply. They have, basically, been moribund since. Normally, low energy prices help to weed out the industry's weak players, but that's taking a painfully long time to happen this time around. A big piece of the problem is the historically low interest rate environment. Here's what you need to know, plus the reason why sticking with the industry giants remains your best course of action.

Oil is a commodity prone to frequent ups and downs. In fact, there has been a series of bull and bear markets in oil over the last few years, despite the fact that the commodity has been largely stuck in the $50 to $60 range most of the time. Although oil prices are historically quite variable, there's something throwing a monkey wrench into the normal cycle today -- low interest rates.  

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Source: Motley Fool
(February 22, 2020 - 12:21 PM EST)

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