Crude Oil Rises Above $42.50 a Barrel
Posted on 26. Feb, 2009 by admin in Crude Oil
Crude Oil climbed 6% to above $42 a barrel on Wednesday, after a U.S. government report showed a sharp drop in gasoline inventories in the world’s top energy consumer. The U.S. Energy Information Administration (EIA) reported a 1.7% rise in demand for fuel over the four weeks prior to February 20th. Further support for Oil prices came from reports this week of high compliance by members of the Organization of the Petroleum Exporting Countries (OPEC) with deep production cuts agreed last year to stem the slide in oil prices. The 11 OPEC members with quotas, excluding Iraq, reduced output by 3.8% to 25.3 million barrels a day in February.
The rise in Crude prices came despite a drop in the equities markets, with European shares hitting a new 6-year low. U.S. stocks fell after U.S. President Barack Obama’s first address to Congress shed little new light on how he plans to stabilize the U.S economy and shore up banks. Analysts expect that Crude Oil prices will probably start rising in the second half of the year as a drop in demand starts leveling off and OPEC cuts supply further.
