Oil Prices Hit Highest Level Since 2014

08 May, 2018, 00:56 | Author: Billie Castillo

Futures in NY and London jumped as much as 1.4 percent.

Also boosting prices is the widespread expectation that US President Donald Trump will withdraw from the Iranian nuclear pact. Iran re-emerged as a major oil exporter in 2016 after worldwide sanctions against it were lifted, and President Trump has a May 12 deadline to determine whether to extend sanction waivers. It was reported last week that OPEC compliance hit a new record high of 162 percent as the cartel pumped 32.12 million barrels per day this month, the survey found, down 70,000 bpd from March. Crude at $60 to $65/bbl is "suitable", an official from the OPEC producer said on Sunday, signaling a split with fellow group member Saudi Arabia that's said to be aiming for $80 oil.

"The expectation that the US will leave the sanctions waivers is leading Iran to sell as much as it can", Petromatrix strategist Olivier Jakob said. "If Trump should decide either to postpone or go for a surprise renegotiation of the deal, oil prices could slump by $5 quite easily".

U.S. West Texas Intermediate (WTI) crude futures rose 84 cents to $70.56 per barrel. Total volume traded was about 23% above the 100-day average.

The dollar, which has enjoyed a sudden reversal in fortunes as investors bet on more Fed rate hikes and a slower pace of tightening in the euro zone, rose 0.3 percent versus the euro to $1.1928.

Brent for July settlement rose 75 cents to $75.62 a barrel on the London-based ICE Futures Europe exchange. Monday was the first time since November 2014 that WTI had climbed above $70 per barrel.

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And his 68 career home runs out of the leadoff spot is just one behind Dom DiMaggio for the most in Red Sox franchise history. He is the first player in Major League Baseball history to have four games with three home runs before the age of 26.

On Monday, Saudi Arabian Energy Minister Khalid al-Falih said he is concerned about low oil industry investment and potential shortages in the future.But U.S. output has soared by more than a quarter in the last two years, to 10.62 million bpd. Iranian President Hassan Rouhani has already warned that the United States would regret its decision to exit the nuclear deal, and concerns over how Iran might react to the United States pulling out do not appear to have been factored into other asset classes.

While refusing to reveal what he will do on Saturday, Trump reiterated his belief the existing accord is "a frightful agreement for the United States", but "that doesn't mean I wouldn't negotiate a new agreement". America's European allies continue to back the deal, saying it has been essential to reining in Iran's nuclear program.

"Fresh sanctions, which would remove some of Iran's crude supplies from the global market, will tighten the balance between demand and supply, and support crude prices", Japan Oil, Gas & Metals National Corp chief economist Takayuki Nogami said by telephone from Tokyo.

The recent surge in prices suggests markets are assuming there will be some disruption to Iran's exports, Shum said.

But Shum said the impact is unlikely to be as severe as the multinational sanctions imposed on Iran in 2012.

Since sanctions were eased in January 2016, Iran's crude production has almost doubled, while exports last month soared to record levels.

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