With oil rallying 14 percent in the second quarter alone, investors might be tempted to take some profits.
That would be a mistake, says one widely followed energy strategist.
“What we’re looking for now in WTI is we’re looking to go to $77,” Helima Croft, global head of commodity strategy at RBC Capital Markets, told CNBC on Thursday's “Futures Now.” “If we break above that, then there’s considerable room to run.”
In other words, Croft believes that oil would still need to rally over 3 percent — but the commodity could keep hitting multi-year highs should that level be reached. The strategist had previously stated at the end of May that a return to $100 oil was possible in the future.
The current geopolitical climate could provide the beginnings of that rally. Earlier this past week, the U.S. pressed its allies to block Iranian oil imports, a move Croft described as an attempt to “take Iran down to zero.”
Since then, oil has spiked to its highest levels since November 2014, and ended June with its fourth straight quarterly gain for the first time since 2010.
Croft believes that tensions in the Middle East could also exacerbate the supply of oil in the market, thereby driving up demand and hiking oil prices higher.
“I think this market is going to tighten in the back half of this year, I think there’s no way around this,” she added.
Croft also stressed that all eyes were also on Saudi Arabia to see how many barrels they could produce. On Tuesday, reports that the Saudis were planning on hitting a record oil output of 11 million barrels a day temporarily sent oil prices lower.
Crude ended Friday's trading session above $74, its highest levels since November 2014.