Oil price hits four-year high as Saudi, Russia rule out increase in production

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International oil benchmark, Brent crude, rose above the $80 per barrel mark on Monday, trading around $81, its highest level in nearly four years.

The upturn in oil prices came on the back of a tightening market and after Saudi Arabia and Russia ruled out any immediate increase in production despite calls by the United States President, Donald Trump, for action to raise global supply.

Brent crude, against which Nigeria’s oil is priced, rose by $2.59 or 3.3 per cent to $81.39 per barrel on Monday, its highest level since November 2014, before easing to $81.34 per barrel as of 8:05pm Nigerian time.

OPEC and non-OPEC countries, including top producer, Russia, gathered in Algiers on Sunday for a meeting that ended with no formal recommendation for any additional supply boost to counter falling supply from Iran.

“The market’s still being driven by concerns about Iranian and Venezuelan supply. The failure of the producers to address that adequately this weekend is creating a buying opportunity,” Reuters quoted Gene McGillian, director of market research at Tradition Energy in Stamford, as saying.

OPEC leader, Saudi Arabia, and its biggest oil-producer ally outside the group, Russia, on Sunday effectively rebuffed Trump’s demand for moves to cool the market.

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