Oil trades at fresh August high on hopes producer action – Reuters

crude-oil-extraction-e1439318146447

LONDON Aug 16 (Reuters) – Oil prices reached their highest levels in more than five weeks on Tuesday as the market rode optimism over potential producer action to prop up the market.

Oil production losses in Nigeria, where more than 700,000 barrels per day (bpd) was missing due to militant attacks and pipeline problems, were also helping to support prices in the Atlantic Basin.

Brent crude futures hit a high of $48.74 per barrel, their highest since July 7, in morning trade. They were trading at $48.59 per barrel at 1042 GMT, up 24 cents from their last close, and around 17 percent higher than the $41.51 low for the month on Aug. 2.

U.S. West Texas Intermediate crude reached $46.16 per barrel, their highest since July 15, before easing to $45.98, up 24 cents from the previous close. The level was roughly 17 percent above its $39.19 monthly low from Aug. 3.

While there were early losses as some investors cashed in during Asian hours, the market has held its roughly 16 percent rally since early August.

Much of the gains have been attributed to investor optimism that oil producers will take action to rein in ballooning oversupply. The hopes stemmed from comments by Saudi Energy Minister Khalid al-Falih, who said his country would work with others to stabilise oil markets.

But a slew of analysts are sceptical of any such deal, and even Nigerian Oil Minister Emmanuel Ibe Kachikwu expressed doubts.

Read more at http://af.reuters.com/article/nigeriaNews/idAFL3N1AX2FZ