$85 by July?

Oil prices are at 3 1/2 year highs (finally!), but is that it or is there more gas in the tank?

It seems popular energy analyst and Pulitzer Prize-winning author, Dan Yergin, thinks oil prices are going to rise even higher, and very quickly.

Yergin, vice chairman of IHS Markit, told CNBC, “We could see oil prices in July when demand is high … several dollars higher than it is. We could see it as high as $85 at least for a short period of time.”

The reasons for Yergin’s approximation:

  • Demand for gasoline will be at a high in the summer months
  • Concern over Venezuela’s falling output which has dropped over 1 million bpd and could continue to drop further
  • Middle Eastern tensions from renewed U.S. sanctions on Iranian crude export, and wars in both Yemen and Syria

Goldman Sachs and Bank of America Merrill Lynch are both bullish: one states that Brent prices could proceed higher than their summer forecast of $82.50, and the other says that Brent could hit $100 by next year. Good news for TAG Oil, and good news for oil investors.

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