Oil prices rose on Thursday with Brent briefly topping $50 thanks to a weaker dollar and a drop in US crude stockpiles, traders said.
Brent North Sea crude reached $50.05 a barrel — breaching $50 for the first time since early last month.
Later around 1230 GMT, Brent North Sea crude for delivery in October was up two cents at $49.87 a barrel following some profit-taking.
US benchmark West Texas Intermediate for September delivery gained 27 cents to $47.06, compared with Wednesday’s close.
“Brent has climbed… to $50 per barrel for the first time since early July, finding support from a weaker US dollar and an unexpectedly marked decline in US crude oil and gasoline stocks,” said Commerzbank analyst Carsten Fritsch.
As a dollar-priced commodity, a weaker greenback makes crude cheaper for those holding other currencies.
The dollar has been impacted by minutes from the Federal Reserve’s July meeting that showed caution over raising US interest rates, dealers said.
US central bank minutes, published Wednesday, coincided with official data revealing signficant declines in US commercial crude stockpiles — signalling a modest strengthening of demand in the world’s top oil consumer.
US crude stockpiles last week fell by 2.5 million barrels and gasoline stocks declined 2.7 million barrels, said the Department of Energy.
Oil prices have hit five-week highs this week, supported by hopes of an agreement between OPEC and non-cartel crude producers to limit excess supplies.
OPEC members and non-OPEC rival Russia are to meet informally in Algeria next month, as reports suggest that OPEC kingpin Saudi Arabia is ramping up production to fresh record levels after an all-time high of 10.67 million barrels per day in July.
Oil price “upside is capped by Saudi’s signals of pumping more oil in August, which could give the kingdom more leverage during talks in Algeria next month”, said EY energy analyst Sanjeev Gupta.
“The oil market will continue to seesaw amid scepticism over the coordinated efforts to stabilise output,” he told AFP.