As for oil prices, some analysts expect to see crude above $50 and heading to $60 by the end of the year, after the maintenance season. But some project prices to go lower before they move higher, and the question is by how much.
Outages in Canada and Nigeria had helped drive prices higher in June, but Canadian crude is coming back on the market and Nigeria's outages are not as severe as initially expected, analysts said. While Venezuela's production continues to fall, OPEC was pumping at an eight-year high of 33.2 million barrels a day in June.
There has been no sign of a letup from OPEC's biggest producer, Saudi Arabia, which pumped 10.45 million barrels a day in June. Iran also continues to increase output, reaching 3.66 million barrels a day.
One bright spot for oil supply, however, has been the decline in U.S. production to about 8.5 million barrels a day, a significant drop of about 1 million barrels a day since last year.
"There was real optimism and hope. It was arrested judgement that this market was getting into balance. It's not right now. Next year it may be better but now it's not and we have a big glut to work off here," said John Kilduff, partner at Again Capital.
When crude rose above $50, U.S. oil industry executives had started to talk about bringing back production if the commodity held that level, but the uncertainty around a Brexit caused a sell-off in crude, as did continuing concerns about oversupply.
"We were on a beautiful trajectory, until we topped out at $52. There's sort of a double top on the chart," Kilduff said. "You need to power through that to make the next run to $60. It did fail there."
Kilduff said the refining maintenance season could be a catalyst for another leg lower.
"We could still plunge again into the upper $30s, if we take out key support at $42, but I think this last plunge will last for some time and that could be a bottom. There's a day of reckoning coming," he said. "I do think if we get that type of severe sell-off, it will be the knockout blow which will cause the market to balance in 2017."
While some analysts continue to see oil reach $60 later this year, Wittner has been expecting an average WTI price of $48 per barrel in the fourth quarter and $46 for the third quarter. He said it's possible oil could reach a natural floor of $40 once refining maintenance season starts but that's not his forecast.
Crude took a hit early Wednesday when the International Energy Agency said oil markets have gone through an "extraordinary transition" from a major surplus to near balance in the second quarter, but it warned there are still high oil supplies.
The latest U.S. weekly government data were particularly bearish for oil Wednesday, and it helped drive West Texas Intermediate crude futures for August to settle more than 4 percent lower at $44.75 per barrel. There was a smaller-than-expected decline in oil inventories last week, but a more worrisome build of 1.2 million barrels of gasoline and 4.1 million barrels of diesel.
"if you look at inventory levels, since Memorial Day, gasoline inventories have trickled on up," said Andrew Lipow, president of Lipow Oil Associates. "I expect that we're going to maintain high inventory levels throughout the summer, going into Labor Day."
RBOB gasoline futures plunged Wednesday, settling down 3.5 percent at $1.378 per gallon. Gas at the pump, meanwhile, has been falling and was at $2.21 per gallon, down from $2.37 per gallon for unleaded gasoline a month ago.
"I think the big news is really in the products. That's what's driving the market down. Gasoline (supply) has been rising over the last several weeks, in the heart of the summer driving season. Good for consumers, and bad for refiners," said Lipow.
He said the U.S. refining industry produced 10.2 million barrels a day of gasoline last week, but drivers only used about 9.7 million barrels.
"Gasoline inventories are 240 million barrels, 10 percent higher than this time last year," Lipow said.
Not only is the U.S. producing a lot of refined product, but refineries in Europe are also at high levels. China has created a new export market and is using its "teapot" refiners to create about 150 percent more refined product than it needs domestically, Kilduff said.