Crude is making a steady comeback, supported by supply disruptions. The Brent variety of crude has recorded $ 49.47, recording a six month high.
Growing political instability in Nigeria in the context of militant threats is the new development that brought up price in the international market.
“Developments in Nigeria and the increasingly tense situation in Venezuela … make a breach of the $50 this week a strong possibility,” the Financial Times has quoted market expert David Hufton.
Not just demand, rising energy consumption by the lone performer in the world economy – India is also attributed to the recovery of crude. In early May, energy forecaster -International Energy Agency observed that crude price may rise than declining, pushed by high demand. The Agency pointed out surging demand from India as the major reason for price rise.
In another report, Crude’s most sophisticated tracker- Goldman and Sach’s Damien Courvalin commented that. “We believe the market has likely shifted into deficit in May.”
Many agencies are agreeing that low prices – near to $20-25s that was witnessed early, are almost over.