Light, sweet crude oil prices gained moderately to settle above $50/bbl for both November and December on the New York market Oct. 18 while the Brent crude oil contract for December settled at nearly $51.70/bbl on the London market.
Crude oil prices rose on growing optimism that the Organization of Petroleum Exporting Countries will finalize a proposed cartel production quota cut and also on a weakening US dollar. Oil is traded in dollars so a weaker dollar makes oil less expensive for buyers using other currencies.
The Wall Street Journal Dollar Index, which tracks the dollar against a basket of other currencies, was down 0.21%.
Oil has traded in a range of $48-53/bbl since OPEC agreed in September to consider cutting its quotas.
Saudi Arabia’s Oil Minister Khalid al-Falih suggested during a speech in London that world oil supply and demand will be rebalanced, ending the 2-year oil price slump.
“We are now at the end of a considerable downturn,” al-Falih told oil executives and investment bankers attending the Oil & Money conference in London.
Al-Falih said he was optimistic OPEC will finalize its proposed crude oil production cuts, which would support the oil market rebalancing. OPEC meets Nov. 30 in Vienna. He also discussed the need for oil and gas investment, warning of a possible future supply shortage otherwise.
Industry needs an estimated $24 trillion to meet world energy demand during the next 25 years, he said.
Heating oil for November rose 1¢ to a rounded $1.57/gal. The price for reformulated gasoline stock for oxygenates blending for November fell 1¢ to remain at a rounded $1.50/gal.
The December Brent crude contract on London’s ICE gained 16¢ to settle at $51.68/bbl, and the January contract increased 21¢ to settle at $52.45/bbl. The November gas oil contract settled at $460/tonne, up $1.50.
The average price for OPEC’s basket of benchmark crudes on Oct. 18 was $48.24/bbl, up 2¢.
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