One analyst is predicting oil prices could skyrocket to $400 a barrel by 2020. The only thing more surprising than the price target is the reason why…
Dr. Philip Verleger, a famed economist studying the oil markets, says a regulation from the International Maritime Organization (IMO) has the potential to create a global recession even worse than the Great Recession.
And while we can’t be certain Verlger’s oil price prediction is 100% accurate, this regulation will almost certainly drive up the price of oil…
The IMO now requires all oceangoing ships to burn low-sulfur fuels by 2020, and there simply won’t be enough low-sulfur fuel to meet that demand.
Currently, two-thirds of the crude oil produced worldwide fails to pass the IMO’s test, and according to Verleger, half of the world’s refineries can’t produce low-sulfur fuel right now.
Once the regulations hit, it’s simply a matter of economics: Rising demand combined with lower supply means prices for low-sulfur oil will rocket higher.
And low-sulfur oils like West Texas Intermediate and Brent Crude are precisely the oil variants that will see the massive price surges.
Verleger isn’t the only one raising the alarm…
Morgan Stanley predicts the IMO regulations will spike demand by 1.5 million barrels per day, sending oil prices to $90 a barrel in 2020.
The International Energy Agency (IEA) says the IMO regulation is “one of the biggest and most pressing issues” in its latest oil forecast. In fact, it called the effect of the regulations a “major uncertainty” in its forecast.
Oil prices could surge anywhere from 30% to 488% higher in 2018, enough to send the global economy into a tailspin.
Fortunately, surging oil prices present an incredible opportunity for the right investments…
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Oil prices are going up, and they don’t need to hit the apocalyptic $400 a barrel for you to make a killing, either.
And we’ve got two ways you can turn rising oil prices into profits.
First, you can buy some of the best stocks on the market with exposure to oil, and you can find them using the Money Morning Stock VQScore™.
It’s simply the best way to pinpoint stocks with the most breakout potential.
Take Exxon Mobil Corp. (NYSE: XOM) for example. Exxon boasts a perfect VQScore of 4, making it a prime candidate for explosive returns.
Click here to see all of our top-rated stocks, and you’ll automatically get free updates on our top stocks, based on our proprietary rating system, the Money Morning Stock VQScore™.
While others might overlook an oil supermajor like Exxon, our system says it’s one of the best buys you can make right now.
Plus, Exxon is already working on a solution to turn high-sulfur oil into the cleaner variety that will pass IMO’s regulations. Its Antwerp refinery is already up and running, and Exxon is sizing up a refinery in Singapore that produces clean diesel.
RBC Capital Markets predicts XOM stock could rise 30% over the next 12 months, jumping from $80.41 a share to $105. But surging oil prices will propel Exxon even higher.
And higher oil prices won’t just benefit oil companies…
Alternative energy will become immediately viable as the world turns to more affordable energy solutions.
And that’s especially true for solar power.
Jon Wellinghoff, former chair of the Federal Energy Regulatory Commission, puts it this way...
Solar power is "going to overtake everything... it could double every two years."
He's not the only expert who thinks so...
According to Ray Kurzweil, a New York Times best-selling author and Google's Director of Engineering, solar has doubled every two years for the last 20 years.
At this rate, solar is less than 16 years away from meeting 100% of the world's energy needs.
The IEA believes solar will soon be the No. 1 source of energy on the planet, pushing oil, gas, and coal to the side.
And early investors could see a potential five, seven, or even 10 times their money BEFORE this even gets going full steam.
Click here to read more…
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