Oil Prices Rise Above $40 Per Barrel
World oil prices rose for a third straight day today with traders brushing aside news of a rocket attack by jihadists on a gas plant in OPEC energy producer Algeria.
The development sees the price of Brent crude, against which Nigeria’s oil is priced, rise to $42.29 dollars, $4.29 higher than the country’s proposed benchmark of $38 for the 2016 budget.
According to reports, with confidence growing that the world’s biggest crude producers will hammer out a deal to curb output, investors piled back into the commodity after they toyed with 13-year lows last month.
Qatar’s energy minister, Mohammed al-Sada, confirmed this week that exporters from within and outside the OPEC cartel will meet April 17 in Doha, stoking hopes of an agreement to ease a global supply glut.
Around 1215 GMT on Friday, United States benchmark West Texas Intermediate for delivery in April was up 72 cents at $40.92 a barrel.
Brent North Sea crude for May delivery won 75 cents to $42.29 a barrel compared with Thursday’s close.
WTI had advanced 4.5 per cent Thursday, closing above $40 for the first time since the start of December.
Buying in recent days has been fuelled also by the Federal Reserve, which on Wednesday halved its forecast for US interest rate hikes this year.
The outlook, citing a global slowdown and market turmoil, sent the dollar plunging, which in turn makes oil cheaper for holders of rival currencies.
“The expectation that the leading OPEC oil producing countries and Russia will agree on binding production caps on 17 April is lending prices additional buoyancy,” said Commerzbank analyst Carsten Fritsch.
Elsewhere Friday, jihadists launched a rocket attack on an Algerian gas plant jointly operated by foreign companies, three years after a deadly hostage crisis at another facility in the Sahara desert.
There were no reports of casualties in Friday’s attack, companies and workers at the site said.
Algeria is one of the world’s largest exporters of natural gas, with revenue from fossil fuels accounting for 95 per cent of its exports.