Oil

The price of Brent crude oil steadied to approximately $63 a barrel on Tuesday on concerns of a civil war in Yemen.

Reuters reported that Brent crude for June was down 50 cents at $62.95 a barrel and US crude for May dropped 45 cents to $55.93 a barrel.

The price of Brent crude has increased approximately 15% this month due to worries over the conflict in Yemen. The seaways around the Arab country play an important role in the international oil trade.

PVM Oil Associates analyst Tamas Varga was quoted by the news agency as saying: "Geopolitics is supporting oil at the moment."

"The price of Brent crude oil steadied to approximately $63 a barrel on Tuesday on concerns of a civil war in Yemen."

The worldwide oil market is currently experiencing ample supplies and a quick build of inventories, especially in the US, affecting prices.

A preliminary survey by Reuters has found that US commercial crude oil inventories are expected to have increased by 2.4 million barrels last week, rising for the 15th succesive week.

Saudi Arabia Oil Minister Ali al-Naimi has recently said the country is expecting to produce at near record highs of about 10 million barrels per day (bpd) in April.

Several analysts indicate that the ability of OPEC to deal with an unexpected increase in demand is weakening.

The spare capacity of OPEC is expected halve to as low as 1.7 million bpd this year.


Image: The worldwide oil market is currently experiencing ample supplies. Photo: courtesy of Anankkml / FreeDigitalPhotos.net.