Oil prices rose on Thursday to their highest since late 2014 as the United States crude inventories declined after sources told the media that top exporter, Saudi Arabia is seeking to push oil prices higher.
As a result Brent crude oil futures at the London exchange have reached $74.44 per barrel. US crude gained 26 cents to $68.73.
Brent climbed 1.1% to $74.30 per barrel, and USA crude was up 0.7% at $68.95, pushing oil stocks closer to buy points and lifting their Relative Strength lines to recent highs.
Mid-week, the EIA and the American Petroleum Institute (API) reported a draw of about 1 million barrels of U.S. oil supplies.
The Organization of the Petroleum Exporting Countries, Russia and several other producers began to reduce supply in January 2017 in an attempt to erase a glut.
OPEC and its partners next meet formally on June 22 but a ministerial monitoring panel will gather in Jeddah, Saudi Arabia, on Friday and are expected to make noises about the broader supply and demand in the oil market.
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"We feel we are at the point where further price support is unlikely unless there is an (unexpected OPEC) supply cut", said Georgi Slavov, head of research at brokerage Marex Spectron. While demand has yet to catch up to elevated supplies, rebounding economies in Europe and steady economic growth in the US could prompt more upside for oil this year. "So they might continue to squeeze the lemon while they have the chance", said Greg McKenna, chief market strategist at futures brokerage AxiTrader.
Resource stocks were on a roll in Asia on Thursday as oil prices hit heights not seen since late 2014 and ignited a rally across commodities, though the potential boost to inflation globally also put some pressure on fixed-income assets.
"Saudi Arabia still calls the shots on global oil markets, and it is increasingly obvious the Saudis are comfortable with oil at $80 or more", said Interactive Investor analyst Lee Wild.
Stockpiles of gasoline also dropped by 3 million barrels, while distillates fuels including diesel decline by 3.1 million barrels. This would shift the initial goal of the scheme and would see it morph into an effort to drive prices up past $80, or possibly even $100, a barrel.
The cuts have been even bigger than those specified in the deal, thanks in part to a slide in Venezuelan production due to an economic crisis in the South American country.