Analysts at investment bank Goldman Sachs warned in a new note to clients about the likelihood of a sharp collapse in oil prices, Reuters reported on Monday, October 26.

Goldman Sachs notes that crude oil storage capacity utilization in the US and Europe is close to “historically high levels.” The note notes that this threatens a repeat of the events of 1998 and 2009, when, as distillate storage capacity was exhausted, oil began to sharply fall in price.

Since June 2014, the price of oil has fallen by almost 60%. The production volume of the countries of the Middle East, Russia and North America consistently exceeds demand on the world market, notes Reuters.

At the same time, the executive director of the International Energy Agency (IEA), Fatih Birol, said at the International Energy Week in Singapore that the supply of oil on the world market may decline in mid-2016, Reuters reports . According to him, if oil prices remain at current levels, then investment in production will fall by more than 20% in 2015 and will continue to decline further.

“If this forecast comes true, investment in the oil industry will decline for two years in a row for the first time in two decades,” Birol said.

Goldman Sachs did not rule out a sharp collapse in oil prices