Brent climbs to $60 first time in two years amid OPEC optimism

 27 Oct 2017 - 18:12

Brent climbs to $60 first time in two years amid OPEC optimism

By Jessica Summers / Bloomberg

Brent crude climbed above $60 a barrel for the first time in more than two years amid optimism that OPEC will extend its supply-restraint deal and indications that the situation between Iraq and the Kurds remains fragile.

Futures were poised to cap their biggest weekly rally since July in London, and crude in New York increased to a six-month high. Saudi Arabian Crown Prince Mohammed bin Salman this week backed the extension of production cuts by the Organization of Petroleum Exporting Countries beyond March. Crude flows from Iraq to Ceyhan, Turkey, remain below normal levels and a U.S. spokesman said the Kurds and Iraqis have not reached an official cease-fire.

“The Saudis keep pressing for an extension of the output-cut deal through next year, so the market is feeding off that and we are seeing signs of tightening out there as a result of the program,” John Kilduff, a partner at Again Capital LLC, a New York-based hedge fund, said in a telephone interview. “The Iraq-Kurd situation is also getting the attention of the market. The volumes are down out of Ceyhan. This is not resolving itself as quickly as it looked like it might have been.”

Brent for December settlement increased 65 cents to $59.95 a barrel at 10:46 a.m. New York time on the London-based ICE Futures Europe exchange. Earlier, they touched $60.08, the highest intraday level since July 2015. The global benchmark traded at a premium of $6.50 to West Texas Intermediate.

WTI for December delivery climbed 81 cents to $53.45 a barrel on the New York Mercantile Exchange.