Jordan Hiscott, Chief Trader at ayondo markets has said:
“Geopolitical tensions come front and centre again, driving the price of Oil to a three and a half year high. Indeed, a plethora of supply issues compounded with instability in the Middle East moves Oil to $71.79. Now confirmed, President Trump has ended cooperation with Iran and the proposed nuclear deal, meaning sanctions are likely in the form of Oil exports.
“In addition, Venezuela, confirmed as having the world’s largest Oil reserves, is in turmoil and showing no sign of abating. In just one year, exports of Oil have fallen by 40% from Venezuela, with production now at an all-time low of below one million barrels a day.
“The culmination of this leads me to believe we are set for an averagely higher Oil price for at least six months, possibly one year. My initial price target would be $92, but it’s likely it could be over $100 a year from now. This is on the basis of the unpredictable nature of the disruption from key suppliers and the seriousness of what could arguably be a proxy war in the Middle East, in the form of Syria from both the US and Russia, backing its respective allies and interests.”