Oil prices have surged over the past couple of months, pushing near the $60 mark at this point. Companies, sectors and countries alike that were benefiting from lower oil prices can look for this windfall to back off some as oil prices rise. However one brokerage firm sees this recent rise as falling short in the near term and that these windfalls may continue for at least a while.

Credit Suisse’s Andrew Garthwaite notes in a report that speculative positions in oil are excessive and appear to have peaked. Ordinarily, this leads to a fall in the oil price. At the same time, if the oil price rose significantly from here it would threaten Saudi Arabia’s market share strategy especially with shale capital expenditures being switched back on at $65 per barrel. Since 1860, bear markets in oil have lasted 11 to 28 years, not seven years.

The recent strength in the dollar points to a weaker oil price, tactically. Credit Suisse’s house view is that oil prices will weaken in the near term, before rising to $71 a barrel in the fourth quarter.

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What does this mean? Credit Suisse would encourage investors to look to buy some of those areas that have suffered from the recent rise in oil prices within the past couple of months. Airlines have been very strong, considering the initial drop in oil prices from last summer. But recent rising prices would look to hamper this industry’s gains. However, the firm suggests that near-term oil will be weak and airlines are still worth buying for now.

According to Credit Suisse:

We reiterate our recent upgrade of UK retailing to overweight, if oil peaks near term. The sector is abnormally cheap versus its peers and its historical norm and the outlook for real disposable income growth is very good. Earnings revisions are positive. Buy Kingfisher, Poundland, B&M.

Other areas Credit Suisse would be looking to buy are some of the energy-consuming areas, particularly those that have underperformed since the trough in the oil price and that have pricing power. The following stocks have positive earnings revisions and are Outperform-rated by the firm’s analysts: Ryanair Holdings PLC (NASDAQ: RYAAY), easyJet, Akzo Nobel. At the same time these stocks are considered cheap on the Credit Suisse institutional platform HOLT.

In terms of international diversification, the brokerage firm would suggest buying into India and Korea. The reason is that these are two of the biggest oil importers, and when India has been this oversold it has outperformed historically. Additionally Credit Suisse suggests caution on Russia-exposed European stocks, which tend to track the oil price (e.g., Oriflame Cosmetics, Adidas and Teliasonera).

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