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Don’t fight the tape on crude, pro says

Tuesday, 27 Aug 2013 | 1:43 PM ET
Don't fight the tape on crude oil, pro says
Tuesday, 27 Aug 2013 | 12:19 PM ET
WTI could hit these levels on Syrian tensions, Addison Armstrong of Tradition Energy says.

Crude oil could top 52-week highs on Syrian tensions and head higher still, Tradition Energy Director of Market Research Addison Armstrong said Tuesday.

"There's a lot of ammunition sitting on the sidelines now to re-enter on the long side, and we look for that $109.32 to be taken out pretty easily," he said, referring to the July 19 high for WTI crude. "And then we're looking at a high back to May of last year of about $110.50."

On CNBC's "Fast Money," Armstrong said that the market was just starting to factor in geopolitical risk from Syria.

"I think it's in its early days of being baked in," he said. "There's a lot of uncertainty of what the outcome will be if there is actual military intervention in Syria. Tehran has made a lot of noise over the weekend about a wider conflict if Syria is attacked.

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(Read more: US strike against Syria 'as early as Thursday')

"And I think that in terms of where the oil price could go, if this were to become a wider conflict, you could certainly easily see prices eclipse the recent high of about $115 and from then, you'd be looking back to 2008 prices with a target of $140, $145 on WTI."

Rising crude oil prices would also likely mean a widening spread between WTI and Brent crude to about $20 per barrel.

"So, even if WTI were to go up to $140, say, we'd expect to see Brent trading at $160," he said.

(Read more: Forget Syria, market was due for a pause: Josh Brown)

By CNBC's Bruno J. Navarro. Follow him on Twitter @Bruno_J_Navarro.

Trader disclosure: On Aug. 27, 2013, the following stocks and commodities mentioned or intended to be mentioned on CNBC's "Fast Money" were owned by the "Fast Money" traders: Josh Brown in long XLU; Josh Brown in long TLT; Josh Brown in long DDD; Josh Brown in long SSYS; Stephanie Link is long AAPL; Stephanie Link is long GS; Stephanie Link is long JPM; Stephanie Link is long WFC; Stephanie Link is long CSCO; Stephanie Link is long EBAY; Stephanie Link is long FB; Michael Murphy is long BAC; Michael Murphy is long C; Michael Murphy is long FB; As of 8/26 Jon Najarian is long AAPL; Jon Najarian is long DDD; Jon Najarian is long EBAY; Jon Najarian is long FB; Jon Najarian is long FIO; Jon Najarian is long HPQ; Jon Najarian is long MGM; Jon Najarian is long WYNN; Jon Najarian is long TSLA.

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