Analyst: Oil Prices Poised for Strong Rebound in 2017

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From OilPrice.com:
August 11, 2016 may be the point in this oil price cycle that will mark the start of a sustained increase in crude oil prices. That’s the date that the International Energy Agency (IEA) published their forecast that demand for oil would exceed supply in the 3rd quarter. Shortly after the IEA’s Oil Market Report came out, the Saudi Energy Minister Khalid al-Falih said the kingdom would work with other producers to stabilize the market. Tighter supply and OPEC willing to curb production growth is a recipe for higher oil prices. 
When you step back and look at a longer time frame, it is clear that this oil price cycle which started in mid-2014 bottomed in February, 2016. The most recent pullback that started late in June and continued through early August was just the speculators overplaying their hand on the short side. The brief dip below $40/bbl did not get close to the double-bottom in February.

Remember what oil prices have never moved up or down for an extended period of time. There are going to be many pullbacks along the way to a more sustainable price level for oil. I believe that oil will settle in the $60-$70 range sometime in 2017. 
During the first week of August, 2016, speculative NYMEX short crude oil positions reached the highest level in at least the past ten years. Since the IEA report came out on August 11th the shorts have been scrambling to cover their positions.
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