Oil: Set to Spike?
Oil prices are at three-year-highs, and may be about to rise further. JPMorgan strategist John Normand wrote Friday that Brent oil could spike to $80 or more if the U.S. and European Union reimpose sanctions on Iran, and as Wester powers appear to be ready to expand the scope of the Syrian civil war. A possible decision in May on Iran sanctions may be “the start of a process that maintains low-intensity stress on oil markets that can deliver higher prices and above-average volatility,” he wrote, comparing it to the Arab Spring of 2011, rather than the major oil spikes of 1973, 1979, and 1990. His forecast follows others in the market calling this a good time to invest in energy.
Net bullish positions in Brent futures reached a record in the week ended April 10.