Now, as this inventory data sends crude oil higher for its third straight session, some strategists see an additional bullish catalyst in rising global uncertainty.
“Everyone has been kind of thinking that oil prices are going to continue to remain low. But the reality is there are many other things that are going around the globe, specifically a lot of geopolitical risk. And what that does is create uncertainty for the future supply of crude oil,” Phillip Streible, senior market strategist at RJO Futures, said Wednesday on CNBC’s “Trading Nation.”
This strike could push crude oil prices up through $50 per barrel “very soon,” Streible said, and ultimately oil will rise to the $53 to $55 range. This range is about 9 to 13 percent higher than oil’s settle price on Wednesday.
“Once we’re up there, we’ll probably start to see the rig count in the U.S. continue to build,” he said, and as more rigs come online and production revs up, oil prices may begin to “level off.”
Furthermore, investors should look for any kind of pullback as an opportunity to position oneself on the “long side,” Streible said, and over the long run oil prices will come to a more “normalized” level.
“Anything in this mid-$40 range, I think, provides some value for crude oil,” he said.
Crude oil settled 1.8 percent higher on Wednesday, at $48.75 per barrel