Crude oil price shoots up again; US crude rates cross $50/barrel

London / New York (News agency): The price of oil has bounced up again attributing to factors like recently held unsuccessful meeting of ‘OPEC’, Nigerian oil pipeline attacks and uncertainty in decision of the Federal Reserve. Brent crude oil as well as US crude oil rates have crossed $50/barrel again. These rates are the highest in the last 8 months. Experts suggest that crude oil rate will a see a rise up to about 55 to 60 dollars per barrel, by the end of this year. On Tuesday in the international market the crude oil price traded higher at $51.22 dollars per barrel. ‘West Texas Intermediate Oil’ price too rose up to $50.29 per barrel. Reports suggest that this is the highest rate, crude oil has reached in last 8 months. At the beginning of the year, rate of crude oil had plunged to $28 per barrel. After that there is a significant rise of 80% in the last 5 months.

It is suggested that the attacks on the oil pipelines in Nigeria have been one of the important factors causing the rise in crude oil price. In last few weeks, few militant groups have targeted Nigeria’s oil pipelines. Nigeria’s daily oil output has fallen by about one and a half lakh (one hundred and fifty hundred thousand) barrels. US’s oil reserves have also depleted by about 3.5 million barrels last week.

OPEC an organisation of major oil exporters of the world had an unsuccessful and inconclusive meeting, however surprisingly Saudi Arabia pledged not flood the market by increasing production. Hence there won’t be an excessive supply of oil in the international market leading to demand supply equation not playing a role to increase the crude oil rate.

In the meantime Saudi Arabia which holds a second place in the list of oil exporters, has cut its oil price to Europe. The price cut is by 35 cents a barrel to northwest Europe and by 10 cents a barrel to the Mediterranean Europe. The underlying reason for this price cut is recent higher supply of crude oil from Iran to European countries, resulting in competition in the oil market.