“Overall, OPEC collectively produced 610,000 bpd less than its stated target in April. That is significant gap. Because most oil market forecasts assumed OPEC would adhere closely to the production targets, and not under produce, most analysts predicted at the start of 2018 that the oil market would see inventory builds again in the second quarter. The severe production losses in Venezuela and Angola, combined with strong demand, suggests that won’t be the case,” according to OilPrice.com.

Some market observers are so bullish that they expect oil to return to triple-digit prices, levels some OPEC members, including Saudi Arabia, would love to see.

Some traders are concerned over how fast U.S. shale oil producers will increase production to capture the rising prices. Rig counts have recently ticked higher and with credit and earnings issues improving for some U.S. shale drillers, those companies may seize the opportunity to exploit higher pricing in the near-term.

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