The fundamentals in the crude oil market got a boost in recent weeks with renewed hopes of a swift recovery in the global economy (demand increases) and ethnic violence in oil rich Nigeria (supply disruptions). This pushed crude prices above $82 a barrel.

There’s nothing new about this fundament argument for rising oil prices. What is new, however, is that the technicals agree and indeed look rather rosy. A run to the $100 per barrel mark over the next few months is quite possible.

Crude oil has been trading in a range since October between 69 and 83 dollars per barrel, in round numbers but this is not the reason for technical bullishness (see Chart 1). After all, in technical circles, trading range tops, also called resistance, are presumed to hold price advances in check unless proven otherwise.

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