It will take six months or so to whittle away the 1m barrels a day of excess oil on the market – with US crude falling to $50 - given that supply and demand are both “inelastic” in the short-run. That will create the beginnings of the next shortage. “We expect a pretty sharp rebound to the high $80s or even $90 in the second half of next year,” said Sabine Schels, the bank’s energy expert.

Mrs Schels said the global market for (LNG) will “change drastically” in 2015, going into a “bear market” lasting years as a surge of supply from Australia compounds the global effects of the US gas saga.

If the forecast is correct, the LNG flood could have powerful political effects, giving Europe a source of mass supply that can undercut pipeline gas from Russia. The EU already has enough LNG terminals to cover most of its gas needs. It has not been able to use this asset as a geostrategic bargaining chip with the Kremlin because LGN itself has been in scarce supply, mostly diverted to Japan and Korea. Much of Europe may not need Russian gas at all within a couple of years.

Bank of America said the oil price crash is worth $1 trillion of stimulus for the global economy, equal to a $730bn “tax cut” in 2015. Yet the effects are complex, with winners and losers. The benefits diminish the further it falls. Academic studies suggest that oil crashes can ultimately turn negative if they to trigger systemic financial crises in commodity states.

David Fuller's view

These comments are interesting and add to my belief that energy crises are largely over and even sooner than I have been predicting in recent years.  Oil crises have been a big concern since the 1970s, when OPEC could (and did) throw the global economy into recession by raising oil prices at will.  The last oil crisis was in 2008 and we are very unlikely to see another similar price spike in crude prices.

The comments on LNG from Australia being able undercut pipeline gas from Russia to Europe are certainly plausible.  However, I think Australia’ main target for these exports will always be Asia.