After the extension of the production reduction agreement, oil prices jump again to $72 a barrel.
Oil prices on Tuesday offset early losses after Saudi Arabia said the producers’ agreement to cut production from January could be extended after June to cover the entire year.
- Brent crude futures were 72.25 dollars a barrel, up by 21 cents, i.e. 0.3 percent from their latest close.
It’s noted that prices were under pressure early today after data from China’s factory activity gained control over the financial markets, including crude oil contracts, indicating that Asia’s biggest economy was still struggling to regain momentum.
- The WTI crude was up 17 cents, or 0.3 percent, from 63.67 dollars a barrel.
US crude oil prices also rose yesterday as the market sought to resume the ascent tide that lasted for weeks and stopped on Friday when Trump called on OPEC to increase oil production and lower oil prices to ease the impact of US sanctions on Iran. Trump’s statement incited the sales at first; temporarily curtailing a 40% increase in oil prices since the beginning of the year.
The surge in oil prices gained momentum in April after Trump tightened sanctions on Iran by ending all exemptions it had given earlier to major oil buyers from Tehran. A senior Iranian official was quoted as saying on Monday that US sanctions on Iran’s oil sector would damage the stability of global crude markets.
US sanctions on Venezuela are also hampering global supplies, while fighting in Libya is also curbing production there. Traders say the market’s focus is shifting to voluntary cuts to OPEC-led supplies, which include Saudi Arabia, the world’s top oil exporter.