Oil has hit a price of $47 per barrel, its highest for the year. This was helped by the falling of the dollar and news that Saudi Arabia and Kuwait appear no closer to restarting their jointly operated Khafji oilfield, which produced 280,000 to 300,000 barrels per day.
A meeting between OPEC and non-OPEC members that was convened almost two weeks ago to discuss the possibility of limiting production was scrapped after the parties reached an impasse.
This helped Brent rise to its highest since November and attracted fresh investment due to declining output anywhere from the U.S. shale basin to the North Sea.
“There was definitely a bit of a turning point when we had the initial sell-off after the producer meeting,” CMC Markets strategist Jasper Lawler said.
“That got reversed and went on to show that (a production freeze) was a fairly small part of what had been supporting the price and really, it’s the supply outlook for the U.S. coupled with the dollar that is really driving returns.”