The oil price of US crude has jumped from $48.50 per barrel in August to $73.50 on Wednesday, according an average of US and Canadian futures, and to $90 on Wednesday.
The jump has been fueled by higher demand from shale producers, but also reflects the weakening of global economic conditions, which have also contributed to the rise in crude prices.
In the US and Canada, prices have surged by about 3 per cent and 6 per cent respectively since the start of the year, according the Bloomberg New Energy Finance data.
“The oil market is a resilient place,” said David Cone, head of commodities research at BNEF.
“The global oil price is now well below $50 per bottle, but there is still a lot of supply available to us and we have an abundance of supply.
It’s not clear how much the increase in prices has to do with geopolitical events, but the increased supply is making the situation more challenging for the oil sector. “
A lot of that supply is in the shale sector,” he said.
It’s not clear how much the increase in prices has to do with geopolitical events, but the increased supply is making the situation more challenging for the oil sector.
US crude crude production rose last month to 5.6 million barrels a day (bpd), up from 4.8 million bpd in July.
But the world’s biggest oil producer, Saudi Arabia, said it expects to ramp up production to 7.5 million bd by end-2018.
While the overall global demand for oil has grown, demand for crude has fallen in recent months.
According to the US Energy Information Administration, the world had just 9.1 million barrels of oil in May, compared with 10.4 million in June and 10.7 million in July last year.
Saudi Arabia’s benchmark benchmark Saudi Aramco said on Wednesday that demand for gasoline rose by almost 5 per cent in May compared with a year ago and oil prices fell 2 per cent.
Oil prices in the European Union fell to $30.43 per barrel, down from $35.50 in August.
Germany’s benchmark DAX dropped 2 per, while France’s CAC 40 slid 0.3 per cent to 1,934.50 euros ($2,931.80).
In Mexico, oil prices hit a three-month high of $55.70 per barrel on Wednesday after surging to a four-month low of $57.75 a barrel in the first week of March.