Brent crude oil prices Thursday pushed through $70 per barrel for the first time in nearly five months, as expectations of tight global supply outweighed pressure from rising U.S. production and lower global demand, Kallanish Energy reports.
Brent futures touched $70.03/Bbl, the highest level since Nov. 12, when it last traded above $70/Bbl. The international benchmark for oil prices settled for the entire trading session 9 cents higher at $69.40/Bbl.
U.S. West Texas Intermediate crude settled 36 cents lower, at $62.10/Bbl Thursday. The contract dropped 12 cents in the previous session after briefly hitting $62.99/Bbl, also the highest since November.
The price for Brent has jumped 30% this year, while WTI has gained 38%. Prices have been underpinned by tightening global supplies and signs of demand picking up.
Trade talks between the U.S. and China made “good headway” last week in Beijing and the two sides aim to bridge differences during further talks this week in Washington, White House economic adviser Larry Kudlow said Wednesday.
Crude is also supported by an agreement to cut production by 1.2 million barrels per day (Mmbpd) by the producer-countries that comprise Opec+. Those countries include most of Opec, plus a number of non-Opec producers led by Russia.
On Thursday, Opec member Libya was on the cusp of open war between the North African country’s main political factions.
Libya has played an outsize role in balancing the oil market because ongoing conflict has contributed to sharp swings in the nation’s output. The involuntary disruptions have helped Opec tighten the market.
U.S. pressure on Iran is increasing, with a senior Trump administration official saying earlier this week Washington is considering more sanctions on the Middle Eastern country.
The refinery maintenance season is also drawing to a close and that will provide further demand for crude, analysts said.
This post appeared first on Kallanish Energy News.