Oil prices will crash to just $10 per barrel over the next six to eight years, as alternative energy fuels continue to attract more and more investors, Chris Watling, chief executive of London-based economic research firm Longview Economics, predicted.
When looking ahead to 2018, Watling acknowledged that a key catalyst for the oil market would most likely be Saudi Aramco's initial public offering in the second half of next year, CNBC reported on Friday.
When he was asked about Saudi Arabia's state oil group being launched on the international stock market, he replied, "I think they need to get it away quick before oil goes to $10 per barrel."
While Watling explained that he did not necessarily expect such an intense decline in oil prices over the coming weeks or months, he did argue that over the long run, "what happens with electric vehicles is really, really important" given that around 70% of oil is used for transportation.
"The world did not live on oil 120 years ago. Oil has not always driven the global economy… The point is alternative energy in some forms is gathering speed and things are changing," he added.
The Longview Economics CEO forecast the price of oil would ultimately slump to $10 a barrel over the next six to eight years.
The price of oil collapsed from almost $120 a barrel in June 2014 due to weak demand, a strong dollar and booming US shale production.
OPEC's reluctance to cut output was also seen as a key reason behind the fall. But, the oil group soon moved to curb production—along with other oil producing nations—in late 2016.
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