On NYMEX, forward curves for Brent and WTI prices fell in the first three weeks of December 2014 for the next 24 months when compared to the same period in November 2014. The average NYMEX Brent forward prices for delivery until January 2017 (represented by the blue line in the graph above) dropped by $12 USD/Bbl to $77 USD/Bbl, while WTI (the red line) fell by $10 USD/Bbl to an average of $66 USD/Bbl for the same delivery period. The Brent-WTI spread also dropped by 22% to $6 USD/Bbl (the purple area) on average for the next 24 months.
Demand for imports in the United States has significantly reduced as the country is moving toward energy independence due to the ongoing shale gas & oil boom. As of December 18, 2014, OPEC did not take any action to ease a huge global oversupply as the United States’ surge in shale drilling has lifted United States output to the fastest pace in three decades. As a consequence, Brent slid as much as 14% for delivery in the next 24 months on expectations that a global oil-supply glut will continue in the coming months. The market expectations are that crude prices will continue to dive to find equilibrium between supply and demand.
 Zhou, Moming. “Oil Drops to 5-Year Low on Concern Supply Glut to Worsen.” Bloomberg. December 18, 2014. Accessed December 18, 2014. http://www.bloomberg.com/news/2014-12-17/oil-drops-below-56-as-iran-resists-production-cuts.html.
Data Sources: CME, NYMEX