In a report, Guggenheim analyst Michael LaMotte upgraded the oil services sector from Neutral to Buy based on the firm’s belief that oil prices are set for a sharp rebound in coming years. Guggenheim is now calling for a return to $100/bbl oil by 2018. Here’s a look at three reasons Guggenheim predicts such a sharp rise in oil prices. 1. Delays In Production Turnaround LaMotte predicts that it will be more difficult than anticipated to re-stimulate production outside of the United States, Russia and OPEC nations following at least two years of plummeting E&P capex. “Specifically, we expect the net, managed decline rate for this 27.7 mmbd of production to decline -2.5 percent pa beginning next year,” LaMotte explained. 2. Wars In Syria And Iraq LaMotte believes that the ongoing conflicts in Syria and Iraq will continue to deflect investment in the Gulf away from oil production and into military and social services investment. In addition, LaMotte sees only 1 mmbd production gain from Iran over the next couple of years and believes that any amount of production beyond 3.8 mmbd will require years of upfront investment. 3. Only Modest U.S. Tight Oil Production Growth A combination of slower drillbit response in 2016 and declining well productivity in 2017 likely means that U.S. tight oil production will be limited to modest growth in coming years. So according to this I would take a chance on buying Continental Resources, Inc., Devon Energy Corp, NewField Exploration Co., Range Resources Corp. and SM Energy Co.