ExxonMobil CEO Rex Tillerson told investors Wednesday to expect at least two years of low oil prices as supply growth continues to outstrip global demand.
“People kinda need to settle in for a while,” Tillerson said at ExxonMobil’s annual investor conference.
ExxonMobil is currently assuming a $55 per barrel global price for its business plans through 2017, the AP said.
The announcement came on the heels of a recent U.S. Energy Department report that found U.S. crude supplies hit an 80 year high of 434.1 million barrels during the week ending on February 20 while production rose to a record 9.29 million barrels per day.
Slow economic growth in Asia and Europe has put further downward pressure on demand.
“I see a lot of supply out there,” Tillerson said.
Tillerson’s forecast echos comments made by BP executives last month.
BP’s downstream chief executive Tufan Erginbilgic said it could take three years or more for the market to work off the excess supply.
BP CEO Bob Dudley expects U.S. production growth to continue into the summer despite falling rig counts.
“At times, it reminds me a little bit of 1986 in terms of the potential for this to be an extended downturn. I think any time the price of oil drops 60 percent it’s not a correction, it’s something different,” Dudley said.