Invoice Smead, chief funding officer at Smead Capital Administration, has a daring market name: that oil costs may soar greater than 100% within the subsequent few years. Smead advised CNBC’s “Road Indicators Asia” on Tuesday that he expects crude costs to rise to between $150 to $200 a barrel over the subsequent three to 5 years. That is a rise of between 100% and $170% from Tuesday’s Brent crude value of round $74 per barrel. It comes as inflation is ready to be a stickier drawback than anticipated, in accordance with Smead. “Too many individuals with an excessive amount of cash [are] chasing too few items,” he mentioned. “Proper now, in the event you’re a enterprise and also you need to rent unskilled labor in the US, the worth appears to go up about 10% each six months,” he mentioned. “Inflation goes to be an issue that’s going to be a recreation changer.” In truth, the image painted by oil producer group OPEC earlier this week suggests robust demand properly into the long run. The group expects international oil demand to hit 110 million barrels a day in about 20 years , pushing the world’s power demand up by 23%. Others have additionally taken a bullish stance on oil costs over current weeks. Eric Nuttall, senior portfolio supervisor at Ninepoint Companions, mentioned earlier this month that oil costs are by means of the lows of the 12 months, after OPEC kingpin Saudi Arabia introduced voluntary manufacturing cuts. Analysis agency Rystad Vitality famous final week that a lot will rely upon China’s financial efficiency within the second half of this 12 months, and the flexibility of the U.S. and Europe to keep away from an financial slowdown amid fee hikes. Nonetheless, it mentioned: “We imagine that, sooner or later within the coming weeks, market fundamentals will drive the oil market. Upside value stress will materialize quickly.” Inventory picks Vitality shares have underperformed the broader market this 12 months, with the Vitality Choose Sector SPDR Fund shedding round 8% 12 months to this point. However fund managers Smead and Nuttall see this as a possibility. Smead likes Warren Buffett-favorite Occidental Petroleum particularly due to its plan to seize and retailer carbon dioxide — a wager that the world will proceed to be depending on oil and local weather targets will solely be met if emissions are faraway from the atmosphere. “This carbon seize factor may simply be to OXY what the cloud enterprise AWS has been to Amazon. In truth, within the case of Amazon, their cloud enterprise mainly has been the one worthwhile a part of that firm,” mentioned Smead. “It will solely make sense that the folks that [are best at] taking carbon out of the bottom can be the most effective at placing it again within the floor.” He additionally named Devon Vitality as one other inventory he likes. Nuttall likes Cenovus Vitality and MEG Vitality . Each corporations have a excessive free money move yield of 12-18% and 19-24% respectively, and Nuttall expects them to hit their final debt goal by the year-end, pivoting towards 100% of free money move returned to shareholders. – CNBC’s Ying Shan Lee contributed to this report.