At a special meeting in Vienna last Thursday, OPEC opted to hold output steady, citing higher demand expectations as the main reason for an unchanged quota.
The chart below shows crude oil prices for the past year to date. You can see that they’ve just broken through the 200-day moving average (blue line), which is a strong technical sign. Crude has doubled from a low of $33 in February (circled).
Oil prices on a roll as they break through the 200-DMA
Source: Stockcharts.com
With a near-30% rise, oil prices look to be on course for their largest monthly gain since March 1999 when they rallied by almost 37%. All this could attract even more investor interest.
Higher prices could be reached before the year is out. OPEC’s Secretary General Abdalla el-Badri certainly thinks so. "If this current trend continues, this recovery as we see it coming now, I think, by year-end, we’ll see prices in the range of $70 to $75 a barrel," he told reporters.
Production cuts (including the non-OPEC nations) coupled with strains on global oil production mean tighter supply and higher demand. This could push oil prices to $80 by the end of this year. That is the price that the International Energy Agency (IEA) said oil prices need to rise to, in order to ensure future oil supplies.
It’s not too late to invest in oil.
Editor’s note: As Profit Hunter’s Chief Investment Strategist, Manraaj Singh has been busy scoping out the best ways to profit from the oil price surge. He’s looked at dozens of companies from around the world and has found the shares that he believes are best placed to profit from this opportunity. Click here to sign up to this unique service.
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