The price of West Texas Intermediate (WTI) traded at $112.38 on 1 May on the New York Mercantile Exchange, after hitting $119.93 on 28 April.
Investment bank Citigroup says the appreciation of the US dollar was a significant development for energy markets as bullish traders had been relying on a downward trend in the dollar as a key justification for continued high prices for crude.
However, it warned that prices could rise again if Nigerian oil workers remained on strike, with about 800,000-barrels-a-day (b/d) of production currently shut down from ExxonMobil’s production facility in the West African country.
“We would also note that the market’s failure to climb past $120 on the back of the recent supply outages tends to send a bearish message,” says the bank.
Despite prices easing from record highs, Opec’s president, Chakib Khelil, warned on 30 April that the price of crude could hit $200 a barrel, adding that the oil producers' cartel would not consider increasing production before it next meets in September.
A MEED Subscription...
Subscribe or upgrade your current MEED.com package to support your strategic planning with the MENA region’s best source of business information. Proceed to our online shop below to find out more about the features in each package.