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February 16, 2015

Brent crude oil increases to $62 a barrel

The price of Brent crude oil increased to $62 a barrel today amid potential supply risk threats to Middle East.

The price of Brent crude oil increased to $62 a barrel today amid potential supply risk threats to Middle East.

Reuters reported that Brent crude increased 60 cents to $62 a barrel and US crude was 43 cents higher at $53.21 a barrel.

Commerzbank analyst Carsten Fritsch was quoted by the news agency as saying: "The oil price is finding additional support from renewed greater perception of the risks to supply. In the short-term, the momentum suggests that prices will climb further."

"The appetite for investments in the Middle East is close to zero, mainly as a result of the unpredictability of the region."

Abundant supplies forced oil prices to decline heavily in the second half of 2014.

The Organization of the Petroleum Exporting Countries decided not to cut its production in order to defend its market share.

The sharp decline in US oil drilling has resulted in about 40% oil price increase over the past four weeks.

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Meanwhile, bad weather has cut Iraq’s southern shipments in February 2015, posing threat to the country’s northern exports.

International Energy Agency chief economist Fatih Birol warned the rise of Islamic State in Iraq and Syria presented a major challenge for the investment necessary to prevent an oil shortage in the next decade.

Birol said: "The appetite for investments in the Middle East is close to zero, mainly as a result of the unpredictability of the region."

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