Iran making the headlines recently has sent the prices of oil soaring over the recent years, with WTI at $71 per barrel and BRENT at $77 per barrel investors are increasingly opting for bullish future of oil. Adding to the disagreement over nuclear deal from US, coupled with the rising tensions and exchange of hostilities between Israel and Iran, the tensions are brewing.

Despite a huge increase in US Oil Production, EIA reported bullish figures this week – a decline in inventories of both Crude Oil and Gasoline inventories more than expected hinting at a higher than expected demand.

Brent crude futures, the international benchmark for oil prices, were at $77.07 per barrel at 0010 GMT, down 5 cents from their last close.

U.S. West Texas Intermediate (WTI) crude futures were at $70.66 a barrel, down 4 cents from their last settlement.

Brent and WTI last week reached their highest since November 2014 at $78 and $71.89 per barrel respectively.

Halt in Iranian supplies could tighten the oil markets, however, an inventory of stocks suggest a global glut in the major markets. Oil traders have reported unsold cargoes in north-west Europe, the Mediterranean, China and West Africa. The sudden emergence of a temporary glut is reflected in the Brent time spreads, with the July-August spread falling from 63 cents per barrel last month to just 24 cents per barrel this week, a five-month low. 

On the hand, however, Bank of America says $100 oil is also possible in short term. Crude is at risk of $100 per barrel next year due to the declines in Venezuela and the potential losses in Iran, according to Bank of America Merrill Lynch.

BoA sees Brent hitting $90 per barrel in the second quarter of 2019, but that could be conservative since it assumes that OPEC increases production. That is why $100 is a viable scenario, the bank says.