Crude extends longest quarterly rally in a decade

Bloomberg

Oil extended gains in London after the longest quarterly rally in a decade as a slowdown in American drilling added to concern that supply losses around the world will lead to a tight market. Brent crude rose as much as 0.7 percent,
after front-month futures climbed for a fifth straight quarter. As concerns over a global crunch due to the loss of Iranian oil mount, President Donald Trump and King Salman bin Abdulaziz of Saudi Arabia discussed efforts to maintain supplies. Meanwhile, the number of working oil rigs in the US dropped for a second week, signalling that American output growth may also be slowing.
Oil has rallied to levels last seen in 2014 as supply disruptions from Iran to Venezuela continued to fracture the global market. Top traders forecast crude above $100, while speculation that backup supplies are scarce is keeping investors nervous before American sanctions on the Persian Gulf state come into force next month. Still, BP Plc has cautioned that a rally may not be sustainable as escalating trade tensions between the US and China could hurt demand.
“The supply situation looks fragile indeed,” said Norbert Ruecker, head of macro and commodity research at Julius Baer Ltd. in Zurich.
Brent for December settlement increased as much as 59 cents to $83.32 a barrel on the ICE Futures Europe exchange and was at $83.05 at 1:26 pm in London. The November contract settled 1.2 percent higher when it expired last week.