“Trump’s sanctions have raised the stakes, and the market is now driven by fear,” Konstantinos Venetis, senior economist at TS Lombard, said in a research note published Monday.
“But at this juncture we think it makes sense to lean against further oil price strength instead of chasing this rally. And if we see $100 on short notice, it would probably be as good a selling opportunity as in July 2008,” he added.
Oil prices skyrocketed to record highs in July 2008, reaching levels of around $147 a barrel before plummeting down to below $30 as the global economic crisis began to bite.
International benchmark Brent crude traded at around $81.44 on Thursday, down around 2 percent, while U.S. West Texas Intermediate (WTI) stood at around $71.85, more than 1.8 percent lower.
“Overall we would put an oil shock in the top three of our concerns over the next year along with trade wars and the ‘exit-sential’ risks in Europe,” economists at Bank of America Merrill Lynch said.