NEW YORK–The price of oil is up 7 per cent on indications that production in the US has slowed following the big drop in prices since last June.
West Texas Intermediate (WTI) surged US$3.18 to US$47.71 a barrel. Baker Hughes reported that the number of rigs drilling for oil in the US fell by 94 in the past week to 1,223. That's down 199 from this time last year. The price of oil plummeted about 60 per cent since June as global supplies grew faster than demand. Opec has declined to cut back on its production, putting pressure on US companies to curtail drilling as oil prices fall to a level that makes some production unprofitable.
Futures prices for wholesale gasoline and heating oil also rose sharply, up more than 5 per cent.
AP