Evanson Asset Management Predicts US Oil Prices to Reach $70 per Barrel by Year-End

Central, Hong Kong, May 5, 2015 (Newswire.com) - Evanson Asset Management’s Chief Investment Officer, Mr. Charles Leung expects the recent rally in the price of oil to continue into 2016 and beyond as he addressed investors at Evanson’s Head Office in Hong Kong.

“With political instability in Yemen we have seen a rise of 20% in the last month alone as concerns over supply disruption threaten the current supply chain. Our analysis is pointing towards a continuing trend as we expect the price per barrel to reach $70 before the end of this year, with further increases to around the $90 mark over the next 12-18 months.”

Our analysis is pointing towards a continuing trend as we expect the price per barrel to reach $70 before the end of this year, with further increases to around the $90 mark over the next 12-18 months

Charles Leung, Chief Investment Officer

Continuing on the oil industry as a whole, Mr. Leung made reference to the supply and demands economics at play that are likely to act as the key drivers to a sustained period of price increases.

“When we consider that the operating rig count has fallen from a peak of 1,600 to just 700 over the last 18 months. The Balkan region and shale producing regions of South Texas are also in production decline. Last week alone a short fall in supply forced the US into drawing on stored reserves, which is a strong indication that supply currently trails demand. As this trend continues we will see an easing in the oversupply of US oil, which in turn will drive the price per barrel upwards.“

Commenting on the emerging US shale oil market, Mr. Leung shared his views on how OPEC will be affected in the future.

“The US is currently dependent on OPEC oil, but we see strong growth and advances in technology that are enabling the shale revolution to ease that dependency. However the US is still along way from total reliance on their production so we expect the price jostles to continue as OPEC continues to call most of the shots.”