Investors are not expecting oil prices to fall any time soon.
According to an array of fund managers, the elevated price of oil looks like it is here to stay – not least because of the supply pressures resulting from Iran's decision to bar sales to western nations.
Just last week the cost of crude oil leapt to $120 per barrel as the west proposed new economic sanctions on the Middle Eastern country.
It is unlikely that the political division will be patched over in the short-term and as a result oil prices will stubbornly stay put.
Speaking to the Financial Times about the rise of crude oil since the start of February, Mark Burgess, chief investment officer at Threadneedle, said: "We have recently had a close look at the energy sector where we expect the oil price to remain high, with Brent averaging $115-$120 for 2012 as supply remains tight, inventories low and geopolitical risks numerous."
He added that the picture was very unlikely to change this year and noted that Saudi Arabia was targeting a floor price of $100 per barrel – which is still high, albeit lower than the current $120 being paid.
Oil is also a safe bet for investors because the world is no nearer to reducing its reliance on the black stuff.
Even Scotland, which is forging ahead with a major overhaul of its energy industry and investing heavily in renewable generation, is not abandoning oil.
Malcolm Webb, chief executive of industry body Oil and Gas UK, said: "This country will remain a petroleum-driven economy for decades yet to come. That is not an anti-renewables statement, it's simply a statement of practical truth."
He said the North Sea still had the potential to yield an astonishing 24 billion barrels of oil before extraction becomes unfeasible.
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