Crude oil prices have seen a volatile 2015, having fallen around 20 percent since the start of the year as the glut of oversupply, which has resulted in a barrel of oil losing over half its value since last summer's highs, persisted.
But after a year of bearish price forecasts, a large number of investors are finally seeing some light at the end of the tunnel for the oil price next year.
While lower energy prices have been helpful for most Western economies, as consumers and corporations can enjoy cheaper fuel, sharply lower oil prices have also highlighted concerns about drooping inflation and stumbling global growth.
This has raised questions over the strength of the economic recovery, particularly in the U.S. where markets anticipate the Federal Reserve will begin to lift interest rates later this year for the first time in nearly a decade.
On a historical view, chief investment strategist at Wells Fargo Asset Management, Jim Paulsen who helps oversee around $500 billion in assets, said in every previous oil price collapse, the economic recovery in the U.S. accelerated and lasted for several more years – and it was followed almost immediately by an increase in interest rates.
"And within a matter of months core inflation rose, rather than decline," Paulsen said, speaking at a press briefing in London.
"This is a stimulant – not a precursor to weak growth, it is stimulant for future growth, just like a tax cut would be or monetary stimulus. This is a huge stimulant and that is how it has typically worked out. The thing that is somewhat frightening is there is not too many people thinking that," he added.
Paulsen said looking at the history of crude and where it was a year after a low was reached, on average it went up 80 percent from its low within 12 months.
"If that happened we would be a $75 crude in 2016. I don't think it is a bad guess. $75 crude is not all the way to full recovery or anything like that, but it would be a big move unexpected by a lot of the markets," he said.
U.S. crude is currently trading around $41 per barrel, having started the year around $52 and spiking to as high as $60 in May.
For much of last summer, prices traded in the region of $100 per barrel before tumbling, with the price falls exacerbated after oil cartel Organization of the Petroleum Exporting Countries (OPEC) deciding to keep pumping oil to protect its market share against U.S. shale drillers and other producers.
All eyes will be on this year's annual OPEC meeting on Friday and whether members will hold oil production steady and maintain and continue a policy that accelerated the worst crude price collapse since the financial crisis.
Head of commodities at UBS wealth management, Dominic Schnider said following signs of oil prices bottoming in this first half of 2015, the price suffered again later on amid concerns of continued oversupply and Chinese demand levelling off.
But he anticipates prices to stabilize and partially recover in 2016, forecasting $63 for international benchmark Brent crude and $60 per barrel for WTI crude in 12 months' time in the group's 2016 house view, published on Tuesday.
"Low prices have curbed capital spending around the world, in particular in U.S. shale wells. As a result, we expect oil production outside of OPEC to contract by at least 0.3 million barrels per day (mbpd) in 2016," Schnider said.
Strategists at both Societe Generale and BNP Paribas were also bullish, with both expecting a more balanced market by mid-2016, as OPEC members are under pressure to change their current production policy, which is bleeding public finances.
"Beyond buying oil itself ($60 price target for end-2016), we propose four ways to gear to this positive oil outlook: inflation-protected bonds, commodity currencies, equity sectors such as integrated oils, and equity markets with high oil content," said head of strategy team at Societe Generale, Alain Bokobza.