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Crude Oil Retreats from Multi-Year Highs

January 2, 2018 at 21:17 by Vladimir Vyun

Crude oil rallied today, touching the highest level since mid-2015, but retreated later. Prices jumped on the news about violent protests in Iran, which resulted in more than a dozen deaths. While there were concerns that the unrest would disrupt Iranian supply of oil, so far that has not happened, relieving such fears.

Russia’s oil output reached a record last year despite the agreement with the Organization of Petroleum Exporting Countries to limit production. However, most market analysts still believe that the concentrated efforts of the OPEC, Russia, and some other oil-producing countries to reduce global glut should continue to support crude in the long term.

But for shorter term, fundamentals looked less positive for the commodity. North Sea’s Forties Pipeline, the major supply route for Brent crude, which was closed last month due to the unexpected crack, is fully operational now. The Energy Information Administration estimated that the United States were producing 9.64 million barrels per day on average in October — the highest production since 1971.

February contract for WTI crude oil was little changed at $60.39 per barrel as of 21:05 GMT on NYMEX today after touching the high of $60.74 intraday. Contract for delivery of Brent crude in March slipped by 0.4% to $66.6 per barrel on ICE following the rally to the daily high of $67.29.

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