Deep structural changes in the market will mean that oil will now forever be classed as a weakly priced commodity, David Roche, president and global strategist at Independent Strategy, has told CNBC.
The strategist predicts that oil prices will remain at around $40 a barrel for this year and could slip to $30 a barrel next year as three fundamental drivers behind the market take hold.
"Saudi Arabia, will keep on pumping, if necessary for years in order to knock out U.S. shale producers which are simply not being knocked out," he told CNBC Tuesday.
Saudi supply
Saudi Arabia, the de facto leader of OPEC (Organization of the Petroleum Exporting Countries) is the traditional swing producer of the oil group that can easily curb or ramp up oil supply. Economists have signaled that the country is currently locked in a "game of chicken" with the recent emergence of shale producers in the U.S.
Oil prices have tumbled since highs of around $115 a barrel in June 2014 and continue to remain low despite rig counts falling back in the U.S. OPEC has refrained from cutting production and a lack of unity at its meeting last week led to more sharp price falls for the commodity on Monday.
Emerging market demand
On the demand side, Roche said that global markets will start to see a period of weakness with emerging markets, which used to waste oil enormously, getting more efficient.
"(Also) emerging markets are growing much more slowly," he added.
Autonomous cars
He added that the globe was also moving into the "digital economy," meaning further changes in demand as technology undergoes radically changes
"Things like electric cars, autonomous cars, share cars, all the rest of it, means that we use less oil," he told CNBC.
One caveat that Roche underlined was that geopolitical tensions from Middle East could still cause a spike in oil prices above $70 a barrel. He believed that either OPEC or U.S. shale producers would only "take action" and reduce supply if prices plunged to around £30 a barrel.
Oil at 7-year low
Crude prices on Tuesday morning edged away from nearly seven-year lows as China reported strong commodity imports despite economic weakness. Overall, however, the market remained weak due to global oversupply compounded by OPEC's decision to keep output high.
Internationally traded Brent futures were up 31 cents at $41.04 a barrel at 08:05 London time. U.S. crude was trading at $37.82 a barrel, up just 17 cents from its last settlement and close to the 2015 and 7-year lows of the previous session.
—Reuters contributed to this report.