US Oil Prices Rise Above $61 per Barrel

U.S. crude prices hit fresh highs on Wednesday, topping $61 a barrel for the first time in 2½ years, as a week of unrest in Iran continued.

U.S. West Texas Intermediate crude was trading up $1.05, or 1.7 percent, at $61.42, near the highest level since June 2015. International benchmark Brent crude rose 94 cents, or 1.4 percent, to $67.51, also near a 2½-year high going back to May 2015.

West Texas Intermediate graph

Concerns over protests in Iran, OPEC’s third largest oil producer, have boosted crude prices this week, even though analysts say the country’s supplies face no immediate risk of disruption.

The gains came despite signs that U.S. drillers continue to pump more as prices rise. U.S. oil output is quickly approaching all-time highs above 10 million barrels a day set in the 1970s.

Pipeline outages in the UK North Sea and Libya have also been resolved, removing a catalyst that sent oil prices higher in December.

Some analysts say the current mid-2015 highs are unsustainable in light of financial positioning among traders. The number of bets that oil prices will continue to rise has risen sharply in recent weeks, while bets that prices will fall have sunk.

via CNBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza