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Brent crude extends rally

Written by Business World, on 17th Feb 2015. Posted in World

article headlineBrent crude prices extended their rally beyond $62 a barrel on Tuesday as the IEA warned of supply risks in the Middle East, although some analysts said that prices had risen too far from six-year lows hit in January. The International Energy Agency's top economist, Fatih Birol, said on Tuesday that the rise of the Islamic State in Iraq and Syria presented a major challenge for the investment necessary to prevent an oil shortage in the next decade "The appetite for investments in the Middle East is close to zero, mainly as a result of the unpredictability of the region," he said. Benchmark Brent crude futures were up 69 cents at $62.09 a barrel by 0647 GMT, while U.S. WTI crude was 48 cents higher at $53.26 a barrel. But analysts said the recent price rises may be overblown. Demand for refined products has been strong in Asia, which is structurally short, and producers have been taking advantage of low crude prices to cover themselves with fuel and build up product inventories. With Brent prices outperforming U.S. contracts the spread between the two benchmarks has risen to almost $9 a barrel, the highest level since August last year, and the trend will continue, analysts said. (Reuters) For more visit: www.businessworld.ie

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