Oil at $14 a barrel? Here's how it could happen

No one really saw 2014's dramatic plunge in oil price coming, so it's probably fair to say that any predictions about where it's going from here fall somewhere between educated guesses and picking a number out of a hat.

In that light, it's less than shocking to see one analyst making a case—albeit in a pure outlier sense—for a drop all the way below $14 a barrel.

Abigail Doolittle, who does business under the name Peak Theories Research, posits that current chart trends point to the possibility that crude has three downside target areas where it could find support—$44, $35 and the nightmare scenario of, yes, $13.65.

Make no mistake, she thinks that's an extreme case. Her target for the more likely move is the $35 range, which in itself is quite a call considering light crude had been just above $100 a barrel this summer and the move would represent a 33 percent or so plunge just from current levels.

But Doolittle makes room for an even more extreme scenario, in which technical support gives way as part of what she describes as a triangular pattern forming in an "ascending trend channel" that brings about the extreme case.

"There is a wild case scenario for a massive fall in oil and it is made by both the triangle and the possibility that oil's true trading path will turn out to be sideways on a potential false initial reaction of epic proportions," Doolittle explained in a report she distributed Wednesday morning. "This possibility cannot be ignored or discounted because it is simply too strong from a technical standpoint."

She acknowledges that the scenario "may sound outrageous" but cautions "odds appear fairly strongly" that the move could be triggered by "a false initial reaction or basically a massive head fake caused by a variety of factors."

Before consumers get too giddy about the cost of even lower fuel prices at the pump, Doolittle offers a word of caution.

"Clearly this would seem to be a tail wind for consumers, but the various shocks and possible financial market crashes that could be triggered by such a collapse in oil would not be, and thus this seems a very dangerous scenario indeed," she said.

Doolittle is known for making some of the more extreme calls to be found on Wall Street. She predicted, for instance, that the mid-October market tumult would continue as part of a 60 percent drop in the S&P 500, a move that has not materialized. http://www.cnbc.com/id/102303607