Wednesday’s hike in crude was spiked by strong demand growth and the first fall in crude inventories since January.
Oil prices increased by 50 percent from a six-year low hit in January due to increasing demand growth and lethargic crude supply. However, trade professionals state that global crude markets are well supplied therefore convincing dealers to sell contracts in order to profit from the recent rally.
The Organisation of Petroleum Exporting Countries (OPEC) delegate stated that “core Gulf oil producers are not wavering in their strategy to focus on market share rather than cutting output alone.”
This in turn indicates that there will be no major policy changes at the June meeting unless non-OPEC producers change their stance, report IBtimes.
Brent crude was trading lower at $67.46 per barrel in comparison to Wednesday's high of $69.63, before settling under $68 per barrel.
In a similar fashion, US crude also declined to $60.59 from Wednesday's high of $62.58 following the fall in US inventory, before closing close at $61.
Moreover, Indonesian Minister of Energy and Mineral Resources Sudirman announced his country’s intention to renew its membership with OPEC as an observer on Thursday. Indonesia, which is currently struggling to expand its crude oil production from 830,000 barrels a day, ended their relationship with OPEC on Jan.1 2009.
Russia, which is known to be one of the world’s largest oil-producing countries, is also considering joining OPEC.