Iran sanctions could soon push oil prices above $90 a barrel, BoAML says

Ali Mohammadi | Bloomberg | Getty Images

A support vessel maneuvers near the crude oil tanker ‘Devon’ as it sails through the Persian Gulf towards Kharq Island oil terminal to transport crude oil to export markets in Bandar Abbas, Iran, on Mar. 23, 2018.

President Donald Trump’s sustained bid to disrupt Iran’s petroleum exports could soon help to push oil prices above $90 a barrel, analysts told CNBC on Thursday.

Crude futures were seen hovering close to multi-year highs during early afternoon deals, after a bigger-than-expected drop in U.S. stockpiles added to a rally fueled by a major Canadian supply outage, concerns about Libya’s exports and efforts by the Trump administration to cut off funds from Iran.

“We are in a very attractive oil price environment and our house view is that oil will hit $90 by the end of the second quarter of next year,” Hootan Yazhari, head of frontier markets equity research at Bank of America Merrill Lynch, said.

“We are moving into an environment where supply disruptions are visible all over the world… and of course President Trump has been pretty active in trying to isolate Iran and getting U.S. allies not to purchase oil from Iran,” he added.

International benchmark Brent crude traded at around $78.18 on Thursday, up around 0.7 percent while U.S. West Texas Intermediate (WTI) stood unchanged at $72.72.