Global oil prices will likely trade between $35 to $40 dollars per barrel by the end of the second quarter, according to one of the world's leading oil experts.
Speaking to CNBC at the 18th annual Credit Suisse Asian Investment Conference on Monday, Fereidun Fesharaki, chairman of FACTS Global Energy (FGE), warned that prices could even dip beyond those levels for a brief spell.
"Actually, there is no floor to the price of oil. The oil floor is the cash cost of shale, which is about $20-$25, so it can go as low as that but it won't stay there," he said.
Moreover, the outlook may get worse if a nuclear deal materializes between the U.S. and Iran. The two countries are currently engaged in talks to reduce Tehran's nuclear programs in exchange for lifted sanctions. As a former energy advisor to Iran, Fesharaki believes there's an 80 percent chance of a deal before the March 31 deadline, which could see a further $5 drop to oil prices.
"As part of the deal, Iranians would like to increase their oil production to the pre-sanctions level, which is 1.2 million barrels per day higher… Within 3-6 months, they will be able to ramp up production, so its bad news for the market which is already jittery."