LONDON: Brent North Sea crude on Friday rose above $51, reaching the highest level since just before Britain’s vote to quit the EU that sent markets crashing.
Brent struck $51.22 a barrel — a peak since June 22 on the eve of the Brexit referendum — on the prospect that producers may agree to a deal to limit high output. Later around 1030 GMT, Brent for delivery in October eased back to stand at $50.82 a barrel, down seven cents compared with the close on Thursday.
US benchmark West Texas Intermediate for September delivery was six cents lower at $48.16 after striking a near seven-week high of $48.71 a barrel.
“The prospect of co-operation between OPEC and Russia to freeze output (around current levels) has been a crucial driver of recent gains, although the market has pulled back slightly today based on movement in the dollar,” said Dorian Lucas, analyst at energy research group Inenco. Falls in the US currency this week have helped to boost demand for dollar-denominated crude. A recovery for the dollar Friday has had the opposite effect.
Prices have meanwhile roared back to enter a bull market since the start of August, rallying more than 20 percent from below $40 a barrel.
Members of the Organization of Petroleum Exporting Countries (OPEC) and their rivals outside the group are to meet informally next month in Algeria, and there have been hints their talks could include ways to tackle an oversupplied crude market despite signs of the glut coming down.
Nigerian oil minister Emmanuel Ibe Kachikwu said on Thursday that while a cut in OPEC production is unlikely, there is hope that the Algeria meeting could help shore up crude prices.
Prices have won support this week also from official data showing falls in US commercial stockpiles of both crude and gasoline.
“We would argue that improved fundamentals are not a key reason for the recent price bounce,” Morgan Stanley said in a note.
“Crude oil demand is anaemic, gasoline demand has decelerated globally, and China crude oil imports are likely to decelerate (in the second half of 2016),” the bank said, adding that supply appears set to surprise to the upside in a number of countries.
Iraq has resumed pumping oil from fields operated by the state-run North Oil Company via a Kurdish pipeline to Turkey for the first time since March at a rate of around 70,000 barrels per day, with plans to double the volume next week.
Brent struck $51.22 a barrel — a peak since June 22 on the eve of the Brexit referendum — on the prospect that producers may agree to a deal to limit high output. Later around 1030 GMT, Brent for delivery in October eased back to stand at $50.82 a barrel, down seven cents compared with the close on Thursday.
US benchmark West Texas Intermediate for September delivery was six cents lower at $48.16 after striking a near seven-week high of $48.71 a barrel.
“The prospect of co-operation between OPEC and Russia to freeze output (around current levels) has been a crucial driver of recent gains, although the market has pulled back slightly today based on movement in the dollar,” said Dorian Lucas, analyst at energy research group Inenco. Falls in the US currency this week have helped to boost demand for dollar-denominated crude. A recovery for the dollar Friday has had the opposite effect.
Prices have meanwhile roared back to enter a bull market since the start of August, rallying more than 20 percent from below $40 a barrel.
Members of the Organization of Petroleum Exporting Countries (OPEC) and their rivals outside the group are to meet informally next month in Algeria, and there have been hints their talks could include ways to tackle an oversupplied crude market despite signs of the glut coming down.
Nigerian oil minister Emmanuel Ibe Kachikwu said on Thursday that while a cut in OPEC production is unlikely, there is hope that the Algeria meeting could help shore up crude prices.
Prices have won support this week also from official data showing falls in US commercial stockpiles of both crude and gasoline.
“We would argue that improved fundamentals are not a key reason for the recent price bounce,” Morgan Stanley said in a note.
“Crude oil demand is anaemic, gasoline demand has decelerated globally, and China crude oil imports are likely to decelerate (in the second half of 2016),” the bank said, adding that supply appears set to surprise to the upside in a number of countries.
Iraq has resumed pumping oil from fields operated by the state-run North Oil Company via a Kurdish pipeline to Turkey for the first time since March at a rate of around 70,000 barrels per day, with plans to double the volume next week.
