SINGAPORE: Oil prices on Thursday remained near levels last seen in late 2014/2015, with markets tightening amid tensions in Iran and due to ongoing OPEC-led production cuts.
US West Texas Intermediate (WTI) crude futures were at $61.76 a barrel at 0110 GMT, up 13 cents from their last close and not far off the $61.97 May, 2015 high reached the previous day.
Brent crude futures – the international benchmark for oil prices – were at $67.82 a barrel, down 2 cents but still not far off the $68.03 May 2015 high from the day before.
Beyond a brief intraday spike in May, 2015, these were the highest crude price levels since December, 2014, at the start of the oil price downturn.
“Oil continued its rally overnight … The market is clearly getting more bullish on oil as inventory levels get closer to the five-year average. Geopolitical uncertainty in Iran, OPEC’s third largest producer, is also helping to support the price as citizens are again protesting the government,” said by William O‘Loughlin, investment analyst at Australia’ Rivkin Securities.
Iran’s elite Revolutionary Guards have deployed forces to three provinces to put down anti-government unrest that has been ongoing for a week, their commander said on Wednesday.
In the United States, crude oil inventories fell by 5 million barrels in the week to Dec. 29 to 427.8 million barrels, industry group the American Petroleum Institute said on Wednesday.
Potentially undermining the trend towards tighter market conditions is US oil production, which has risen by almost 16 percent since mid-2016, hitting 9.75 million barrels per day (bpd) at the end of last year.
Official US Energy Information Administration (EIA) storage and production data is due on Thursday.