There is further upside potential in both U.S. oil major stocks and the underlying commodity - provided OPEC is able to keep to the terms of the deal it announced Wednesday, according to a chief investment officer at Credit Suisse.
Michael O'Sullivan, chief investment officer of international wealth management at Credit Suisse, says the strategy of betting on a continued recovery in the oil price still has room to run.
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"We are overweight oil, it's one of the stronger tactical bets we put on back in August and I think there is room for it to improve," O'Sullivan said.
However, he also cautioned that "adherence to this deal is going to be key".
In terms of ways to play the deal, O'Sullivan noted that there were several options available with shale producers coming back into focus as oil works its way back up to a level where their operations once again become profitable.
The investment officer also insisted that, despite a sectoral repricing in recent months,there were still pockets of opportunity.
"There's value in the majors," he opined, adding that it was some of the smaller names that have seen the biggest run-up in recent months.
As an example of smaller players' recent outperformance, O'Sullivan highlighted Britain's Tullow Oil, whose stock enjoyed a near 14 percent rally in the wake of the announcement of the OPEC deal to cut production on Wednesday and has spiked by nearly 80 percent during this calendar year.
He also drew attention to the political dynamic in play, saying that President-elect Donald Trump's vow to cut corporate taxes would work out well for oil companies.
"The energy sector has the highest effective corporate tax rates, so if tax rates come down the big energy companies will actually benefit," he noted.
While acknowledging that higher energy prices and interest rates can work to undermine efforts to boost the economy by acting as an effective tax on spending potential, O'Sullivan said that the market was too deep set in its reflationary mindset to focus on this logic for now.
Given that, equities may have slightly further upside left within them for the remainder of 2016 as the bond market maintains its selling bent, he said, as both trades are consistent with investors' current belief in the reflationary story.
Yet he cautions the enthusiasm for this investing strategy may be overdone and suggests that rather than taking profits on oil-related investments, it may be preferable to do so on assets, such as copper, which have rallied strongly on expectations for President-elect Trump to significantly boost infrastructure spend.