The price of crude oil hovered around the $45 mark Friday, however, some analysts say the U.S. may see WTI returning to the $100 level in the next year resulting from a stronger-than expected global demand for oil.
A leading portfolio manager from Auspice Capital Partners, Tim Pickering, said he is confident oil will return to the glory days of $100 a barrel due to an increase in demand for oil products and disarray amid the Organization of Petroleum Exporting Countries (OPEC).
“Worldwide demand is growing for crude oil,” Pickering told Global News. “We are seeing the expansion in large economies, like the fastest growing economy of India.
Pickering said he doesn’t see a rate cut coming from OPEC in 2017, but he does see reductions in drilling occurring throughout North America.
“It’s not going to happen immediately,” he said. “Eventually that North American supply will come back into balance, and that will be due to a sustained over price like we’ve been.”
“You’re going to have to be patient with oil prices. It could still be a tough six, or nine months, or even a year, but long term over the next few years we are bullish.”
Most Wall Street investors seem to agree with Pickering’s optimism regarding the price for oil.
A June report from Bloomberg suggested investors have been buying options betting that the resource reaches prices of US$80 per barrel in 2018, US$100 in 2019 and US$110 in 2020, according to data obtained from the U.S. Depository Trust and the New York Mercantile Exchange.