Oil price rises towards $70

Oil price rises towards $70

Iran wants OPEC to work to keep oil prices around $60 a barrel to contain USA shale producers, Oil Minister Bijan Zanganeh told The Wall Street Journal in a rare interview, while Saudi Arabia has played down shale's ability to upset the market and has indicated $70 for oil is acceptable.

The split, apparently, stems from Saudi Arabia's insistence that crude oil should be kept closer to US$70 a barrel-a level Brent touched briefly early this year-and Iran's equal insistence that US$60 is a better place for oil to trade at.

Oil markets climbed on Monday, March 12, on the back of a drop in the number of United States rigs drilling for more production and as the US economy continued to create jobs, which industry hopes will drive higher fuel demand, NAN reports.

The US consumer price index comes out Tuesday. "They continue to give market share away to the U.S".

Crude oil prices fell Monday ahead of closely watched United States inflation data that may set the stage for interest rate hikes. That split is driven by differing views over whether $70 a barrel sends US shale companies into a production frenzy that could cause prices to crash. The dollar tends to have an inverse relationship with oil prices, as a weaker greenback makes dollar-denominated commodities cheaper for holders of other currencies. At stake is OPEC's production limits, which are among factors helping the oil market's monthslong recovery.

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Energy services firm Baker Hughes said on Friday that energy companies last week cut oil rigs for the first time in nearly two months. It was the first such decline in seven weeks.

CNBC noted that hedge funds and money managers have pared their bullish wagers on WTI, with long positions falling last week for the first time in three weeks; meanwhile, gross short positions (bets that prices will fall) on the New York Mercantile Exchange climbed to their highest level in almost a month.

The oil production in the United States is not the only problem.

Nymex reformulated gasoline blendstock-the benchmark gasoline contract-fell 0.6% to $1.89 a gallon.

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