Oil prices edged away from 5-week highs on Tuesday, with traders cashing in on a 16-percent rally since early August that has largely been fueled by talk of producers taking action to prop up the market, Reuters reported.
International Brent crude oil futures were trading at $48.14 per barrel at 8.55 p.m. ET, down 21 cents from their previous close. Despite the dip, prices remained over 15% higher than the monthly $41.51 per barrel low from August 2, according to the report.
U.S. West Texas Intermediate crude was trading at $45.56 a barrel, down 18 cents from its previous close, but still over 16% above its $39.19 monthly low from August 3.
Traders said the price falls were the result of cashing in following more than two weeks of rallying prices, according to Reuters.
”Crude oil rose to a four-week high as speculation continued to mount that OPEC would discuss a potential cap on production at an upcoming meeting between the members of the group. Russia joined in, saying it was open to such talks as well,” ANZ bank said.
Led by top crude exporter Saudi Arabia, the Organization of the Petroleum Exporting Countries (OPEC), has re-launched a debate about oil producers potentially capping soaring output in an effort to reduce a global overhang in production and storage of crude oil and refined fuel products, according to the report.
Analysts said that concerns over oil production in Venezuela were also impacting markets.
Venezuela, which holds the world`s largest crude oil reserves, is on track to suffer its steepest annual oil output drop in 14 years as it struggles with an economic and political crisis and years of underinvestment and mismanagement.