Oil prices are set for a huge move — probably upward, predicts top oil trader Mark Fisher of MBF.
Fisher has built one of the largest and most successful clearing firms and proprietary trading outfits, making him one of the most closely followed oil traders, according to CNBC.
Oil has fallen to $83 a barrel because Saudi Arabia increased production, he told CNBC.
"They're trying to put the screws on Iran."
But after tougher sanctions against Iran are put into place later this month, Saudi Arabia may let oil to go back to $100, Fisher predicts.
Either way, it's going to move, he says. Eighty-three dollars a barrel is not the long-term equilibrium price for oil. It will either jump to $100 fall to $65.
"I think ultimately we're going up," Fisher told CNBC. "That's my gut, but when I get a gut feeling, I'm either really right or really wrong."
The OPEC meeting on Thursday may indicate the possible direction of future oil prices.
"Historically, the first move oil makes out of the OPEC is the wrong move," he says. After a couple days, the price heads in the other direction.
The International Energy Agency said Iran's oil exports have dropped by about 40 percent this year due to sanctions, according to Reuters. Its oil exports fell from 2.5 million barrels a day at the end of 2011 to 1.5 million barrels in April and May.
Although the world now has a good supply of oil, it is not over-supplied, the IEA cautions.
"Nobody knows exactly how oil supplies will develop this summer," the agency states in a recent report. "Memories are indeed short: crude prices remain very high in historical terms, and are acting as a drag on household and government budgets in OECD and emerging markets alike."
Demand from the power sector this summer and stockpiling by major countries like China ahead of the Iranian embargo could impact oil prices, IEA says.
© 2013 Moneynews. All rights reserved.