Oil spikes higher

17 January, 2017

Oil spikes higher

Oil has spiked higher on Al Falih comments in Davos (Saudi oil minister). He said during a panel discussion at WEF in Davos that there will be inflation in the cost of doing business in the oil industry, following the squeeze that accompanied the decline in crude prices.

Al Falih also added that the supply industry has been decimated and once they see that their clients (the operators in the shale and elsewhere) are in the black, they will start raising costs. 

Al Falih commented on the situation in the US as well. He said that with oil above $50 SA is seeing a recovery in North America and the country is thankful for this. Saudi Arabia needs the contribution from all sources of the oil supply base so the country hopes that Americans will be able to maintain this. Ending his speech Al Falih said that ’ultimately what rules is the market’. Oil trades at week-high post the comments, falling USD also favors the rise of oil prices.


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