Crude oil prices should stay in the triple digits, Kpler's head of Sweet Crude Analysis Matt Smith told Yahoo Finance.
There won't be a continued downward pressure on oil, according to Smith.
"I don't think that we're going to see continued downward pressure on oil. I think what we're seeing in the last couple of weeks in the oil market is this selloff as oil has got swept up in broader market sentiment as we've seen a selloff in equities, etc. It's a risk appetite thing," Smith told Yahoo Finance.
Instead, Smith sees crude oil prices supported by OPEC, because while they are saying they continue to put more oil onto the market, they are failing to boost their exports. In fact, as Smith points out, we've seen Saudi Arabia's exports drop in recent months.
So while OPEC is saying they are producing more, "We're not seeing those barrels actually hitting the market. We're not seeing an increase in terms of those exports."
Smith also points to forecasts of lower crude oil production out of Russia by the end of the year-a support for higher oil prices.
"This is very much a supply-side story, and we should remain above triple digits here."
Crude oil prices were rallying on Friday ahead of the long weekend in the United States, with WTI crude up 2.73% on the day at $108.70. The high crude oil and gasoline prices in the United States pose a problem for the Biden Administration, which has proposed numerous strategies for lowering crude oil and gasoline prices--so far to no avail.
The average gallon of gasoline in the United States is still up $.171 over the last month, and up $1.719 per gallon from a year ago.
By Julianne Geiger for Oilprice.com
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Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group. More