There is a real disconnect between oil prices and the future growth expectations of the United States economy, especially now that the Federal Reserve (the Fed) has decided to cut interest rates in September 2025. Interest rates act as gravity on business activity and earnings potential, and the lever has been turned lower to help these two factors float more freely in the coming quarters.
Historically (and logically), more business activity represents more demand for oil, and the low inventories seen today due to past slowdowns could create a real bottleneck and spike in prices were the levels of activity and demand rise along with these lower interest rate environments.
