Oil hit a 1-year high on Monday, driven by bullish sentiment across the financial markets. John Kilduff, vice president and co-head of MF Global, as well as a CNBC contributor, discussed the future of oil prices.
“We’ll see $80 very shortly—we’ll be at $79 when the new front-month contract comes into play next week,” Kilduff told CNBC.
Kilduff said China plays a big role in the oil price increase.
“Their GDP is 7 percent and they sold over a million cars last month for the first time,” he said. “It’s a big part of the structural issue that we face.”
Kilduff added that the commodity markets priced in a “resource crisis” last July an “economic Armageddon” in December, of which neither occurred.
CNBC Data Pages:
“So between $30 and $150, where’s fair value? I think it’s closer to $100 than it is any other number,” he said.
"The budget deficit number that came out on Friday will further weaken the dollar and underpin the commodity prices,” Kilduff added.
More Market Intelligence:
- What Bubble? Commodities Rally Far From Over
- Weak Dollar an Economic ‘Shock Absorber’: Strategist
- 'Melt-Up' Coming for Stock Markets: Strategist
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CNBC Slideshows:
- Cramer's 12 Stocks to Play the Recovery
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Top Oil Companies:
ExxonMobil
Chevron
ConocoPhillips
BP
Valero
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Disclosures:
No immediate information was available for Kilduff or his firm.
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