Commodity investors generally agree that the oil market is coming into balance, but huge stockpiles of fuel and teeming strategic Chinese crude inventories could send prices on one last, ugly slide lower, analysts tell CNBC.
On Wednesday, oil futures were down more than 1 percent, following a nearly 5 percent slide Tuesday, on worries that Britain's vote to leave the European Union would slow economic growth and dent crude oil demand. Expectations of U.S. crude stockpile growth and further weakness in the Chinese economy created additional headwinds.
In recent weeks, supply and demand have appeared tantalizingly close to balancing each other.
Oil markets at least briefly appeared to be oversupplied by about 350,000 barrels of crude per day last week, based on an average of major investment bank estimates, according to Tom Kloza, global head of energy analysis at oil price information firm OPIS.
"The sense was we had tilted to where we were using more than we were producing worldwide. But, boy, that is a subjective call," he told CNBC.