Crude Falls as Iraq Says No to Production Cuts, But Some Analysts Insist We're Heading to $70/bbl

Some analysts believe the market will defy fundamentals in the near future.

In a move analysts predicted the day the deal was announced, Jabar Ali al-Luaibi, oil minister for Iraq, said his country wants to be exempt from the output reduction members of the Organization of the Petroleum Exporting Countries (OPEC) loosely agreed to earlier this month.

Falah al-Amiri, head of Iraqi state oil marketer SOMO, added that Iraq's market share had been compromised by war and that it "should be producing 9 million [barrels per day]."

But although the remarks lent further credence to the consensus that the deal won't be ratified and caused Brent on Monday to settle 30 cents to $51.18 and West Texas Intermediate to settle 33 cents to $50.52, one expert has broken from the pack of popular opinion and predicts oil will soon skyrocket.

Marc Faber, the publisher of the Gloom, Boom & Doom report, told CNBC that economic growth in Asia will boost prices overall and cause oil to easily test $70 a barrel in the near future.

Better known as Dr. Doom for his pessimistic forecast, Faber said, "In the western world, they believe — I'm not saying it's the right belief — but the belief among economists and the neo-Keynesian and the interventionists is that monetary policy alone cannot lift the global economy out of its slow growth mode; so they have to go and build infrastructure and boost governments' fiscal deficits.

"This combination of infrastructure in emerging economies and infrastructure spending in the developed economies of the U.S. and Europe, in my opinion, will mean that inflation will actually surprise on the upside."

Joining Faber in this rosy outlook is Louise Yamada, founder of Louise Yamada Technical Research Advisors, who produced two charts for CNBC showing that crude is targeting new levels around $70.

However, Yamada conceded that her outlook could be challenged: "There's a lot of interim resistance: it could take another six months before we even get towards $60; it could go sideways a little bit more and inch its way up over time.

"With all the supply stories, one has reason to be skeptical."

Following the news from Iraq and Monday's losses, Matt Smith, director of commodity research at ClipperData, summarized the analytical community's sentiments heading into OPEC's November meeting in Vienna by remarking, "This just casts one more spotlight onto potential uncertainty ahead."

Iraq joins Iran, Nigeria, and Libya as the fourth OPEC member to seek an exemption from output limits, and its determination to get it is underlined by al-Amri, who also told reporters, "We have passed 4.7 million barrels a day [and] we are not going back: it's a question of sovereignty."

Earlier this month, Gaurav Sodhi, senior analyst at Intelligent Investor, expressed bewilderment that anyone was taking the OPEC proposal seriously: he called the cartel "a dying organization with limited relevance in a world where shale is now the swing producer and the marginal setter of prices."