Published: Mon, September 24, 2018
Markets | By Otis Pena

Oil Price Jumps To Four-Year High, Nears $81

Oil Price Jumps To Four-Year High, Nears $81

"The market is well-supplied", Saudi Energy Minister Khalid Al-Falih said after a meeting of OPEC and its allies over the weekend.

Commodity traders Trafigura and Mercuria said they expected Brent crude to climb above $90 by Christmas and to pass $100 early in 2019.

Brent crude LCOc1 hit its highest since November 2014 at $81.39 per barrel, up $2.59 or 3.3 percent, before easing to $80.86 by 1:09 p.m. EDT (1705 GMT).

Russian Energy Minister Alexander Novak said no immediate output increase was necessary, although he believed a trade war between China and the United States as well as USA sanctions on Iran were creating new challenges for oil markets. "In my view, that makes it conceivable to see a price spike north of US$100 a barrel".

"The market does not have the supply response for a potential disappearance of 2 million barrels a day in the fourth quarter", Jaeggi said in a speech at the S&P Global Platts Asia Pacific Petroleum Conference (APPEC) in Singapore.

The price rise is notably caused by a recent drop in Iran's supply because of USA sanctions. However, the consensus has now moved to as much as 1.5 million barrels daily as the United States is "incredibly serious" about its measures, he said.

"The biggest issue is not with the producing countries, it's with the refiners, it's with the demand". -China trade war and supply, especially from the USA, was seen sufficient in the next 12 months, said Janet Kong, BP Plc's head of trading in Asia.

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But delegates at the party's annual conference in Liverpool backed a proposal for that threshold to be reduced to 33%. Corbyn's second in command, finance spokesman John McDonnell repeated that Labour was getting ready for an election.

Saudi Arabia signaled the kingdom is in no rush to bring oil prices down from current levels. However, Saudi Arabia and Russian Federation now say they have no more capacity.

Wall Street bankers and hedge funds also saw some caveats to the bullish mood.

"We protect the countries of the Middle East, they would not be safe for very long without us, and yet they continue to push for higher and higher oil prices!" he tweeted on Thursday.

For consumers, that could mean higher gas prices on the way, but it's good news for Canadian oil producers and helped boost stock prices in Toronto today.

Those are the highest prices since December of 2014, just before oil began its slide that took it down to $40 U.S. a barrel in 2015, discouraging investment in the oil patch.

Higher gasoline prices for USA consumers could create a political headache for Republican Trump before mid-term congressional elections in November.

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