- Crude is tracking for its worst first half in at least 20 years.
- Gartman, a big commodities player, says a bounce is possible, but there's more pain in store.
- The downturn "may be a black swan for the oil industry itself, but it's a white swan or the economy in general," he added.
Crude oil has officially entered a bear market, and Commodities king Dennis Gartman told CNBC the pain is far from over.
In a recent interview, the editor and founder of The Gartman Letter said oil conglomerate OPEC was losing the war on oil, especially in light of the ascension of Saudi Arabia's new crown prince, Mohammed bin Salman. Crude oil is down nearly 20 percent in 2017, and is tracking for its biggest six-month drop since the late 1990s.
"He understands that crude oil, over the course of the next 20 to 40 years, is going to be a worthless commodity," said Gartman. "It will be supplanted by something else."
Crude oil posted its fifth consecutive weeks of losses, its longest weekly losing streak since August 2015. While Gartman expects the crude crush was far from over, he does expect oil to bounce back to $46 in the short-term.
"I bet over the next 2 weeks, you get a bounce," he told CNBC's "Futures Now" this week. "That wouldn't surprise me, since we have been down far more than we probably should have given the fundamentals at this point," Gartman said.
"But I'll tell you one thing: in the long run, crude oil is heading egregiously lower," he added.
In fact, most Wall Street economists see no immediate end to crude's downside. In a research note on Friday, Bank of America-Merrill Lynch stated that global demand was the primary culprit behind crude's woes.
"Oil demand has also failed to improve at the speed required to rebalance the global oil market," the bank wrote. "We doubt that demand growth will accelerate sufficiently to break the current downward price momentum."
However, Gartman has soothing words for investors wondering if crude could be the next 'black swan' anomaly to hit the market's brisk rally. While oil companies may be hit hard by lower crude prices, ultimately Gartman sees the lower prices benefiting the economy as a whole.
"So it may be a black swan for the oil industry itself, but it's a white swan or the economy in general," he concluded.