Crude oil was trading at $79 a barrel in the US, the world’s largest consumer, on 19 November after a month of relative stability.
The December West Texas Intermediate (WTI) contract was trading at $79.08, up $2.18 from a week earlier after being buoyed by news that supplies had fallen in the US. The local Energy Information Administration (EIA) reported on 18 November that inventories in the US fell 900,000 barrels to 336.8 million barrels.
Europe’s Brent contract for January was up from $75.18 a barrel to $78.99 a barrel between 12 and 19 November.
The average price of oil produced by the oil cartel Opec rose from $76.89 a barrel on 11 November to $77.87 a barrel on 18 November, in line with the US and Europe.
Analysts say prices are finding a new equilibrium at the top of a $70-80 a barrel range, as traders try to find a fair price for crude.
They also note there is psychological resistance to pricing crude at more than $80 a barrel, a level which is regarded as unsustainable in the current economic environment.
“People seem to think that $70 plus is a fair price at the moment,” says one London-based oil analyst. “At the same time, they don’t want to push their luck too much and burst the recovery bubble and push prices back down again.”