Looking further ahead there are some significant technical, and by technical I mean regulations, engineering and chemistry sort of technical not price charts, changes coming which could potentially have a significant impact on oil prices.
The change is that International Maritime Organisation (IMO, an agency of the United Nations) regulations will reduce the allowable sulfur content in bunker fuels from 3.5% to 0.5% effective January 2020 so just over a year away.
Here's the relevant facts and figures. Sources are the BP Statistical Review of World Energy, the International Energy Agency and some of my own knowledge arising from other sources.
Ships consume about 3.4% of all oil used or 3.34 million barrels per day.
84% of the fuel used in ships is heavy fuel oil (also known as bunker oil or No.6 fuel oil). In layman's terms this is the residue left after crude oil is refined into petrol, diesel, kerosene etc. It's thick black stuff which looks a lot like Vegemite or black grease and won't flow at all unless heated which is the standard practice.
That shipping use of heavy fuel oil represents about 2.8 million barrels per day or 40% of all heavy fuel oil consumption. Other major uses are as boiler fuel in industry, military vessels and to a declining extent power generation and heating of large buildings.
Now it's not impossible to remove most of the sulfur from heavy fuel oil. It costs money and requires significant additional equipment at refineries but it can be done. Thing is, since there hasn't been much demand for such a product it is
assumed that refineries in general won't have invested to be able to produce it since businesses generally don't build expensive facilities to produce something nobody wants to buy.
So that raises the question of what happens?
One option would be that ships switch to diesel since technically that isn't particularly difficult, diesel is readily available and it meets the regulations. That would however mean a 10% rise in global diesel consumption or 2.8 million barrels per day.
Producing that diesel requires more crude oil, rather a lot of crude oil actually. It also raises the question of what to do with the fuel oil no longer being burned in ships but which will still be coming out of refineries? Burning it for power generation in countries which don't have regulations precluding it would be the obvious answer. Or burn it for power generation in Japan, the only country that has significant oil-fired power generating capacity fitted with flue gas scrubbers to remove the sulfur.
Ultimately this is all resolvable with a technical approach, just take the sulfur out of heavy fuel oil, but it would seem at least possible that there's going to be quite a bit of disruption in oil and refined product markets around the end of 2019 until it sorts itself out with the required changes to refineries. 10% more diesel and 40% less heavy fuel oil consumption is a pretty huge change to happen virtually overnight.