Yahoo Finance Oil prices will jump 25% in the next 6 months but it's a 'believe it when I see it market,' analyst says
US crude oil prices could climb to $90 to $95 per barrel in the next six months, according to CIBC's Rebecca Babin.
That represents a 25% surge from current levels.
But she also told CNBC that a $100-per-barrel price for crude is "overzealous."
US crude oil prices could climb as much as 25% in the next six months, according to CIBC Private Wealth senior equity trader Rebecca Babin.
She told CNBC on Thursday that West Texas Intermediate could hit $90 to $95 a barrel, while international benchmark Brent could reach $95 to $100, though surpassing $100 would be "overzealous."
Currently, WTI is up 2% at $75.42, and Brent is up 1.85% at $82.09.
The re-opening of China will be a "huge swing factor for demand," which could increase by 1 million barrels year-over-year, Babin said.
But she also acknowledged that the market has anticipated such a China-led rally in oil prices before only to see them pull back again.
"There's definitely been a lot of hype around this trade," Babin said. "We've been talking about this now for six months. And it a fair point: this is a little bit stale. We're waiting for this rose to bloom, and every time it starts to, we get hit with another macro headwind. I think there's hesitancy to buy into that trade, when you've struck out a number of times before and are playing it a little bit more cautious. Its' a 'I'll believe it when I see it market.'"
Meanwhile, she sees the prices of refined products rising this summer too, especially if sanctions on Russian fuels keep supplies off the market.
In the US, gasoline prices to tick back up close to $4.50 a gallon but stay below $5. Still, even at $4.50, that would still represent a jump of more than 30% from the current average US price.
"I do think we're setting up for increases over the summer for refined products," she said. "Not as dire as last summer, but still some upside."
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