A production freeze by major exporters and stronger US fuel demand helped oil prices touch new peaks for the year 2016. Brent crude was down 8 cents at $41.46 a barrel by 1746 GMT, having risen $1 earlier to a 2016 high of $42.54. US crude was down 31 cents at $39.89, after gaining $1 earlier to a year high of $41.20.
Reasons for the upward movement:
- Over the past two months, prices rallied to reach above $40 after the Organization of the Petroleum Exporting Countries (OPEC) floated the idea of a production freeze.
- Strength in world equity markets, which were up for a fifth straight week, had also boosted oil.
- Surging gasoline consumption in the US also helped the price recovery.
“The market is probably too long here and needs a correction,” said Scott Shelton, energy futures broker with ICAP in Durham, North Carolina.
“Oil prices are on the verge of closing higher for the fifth straight week,” said Fawad Razaqzada, analyst at City Index trading group.
Source: Arab News
