WTI Crude Oil Price Hits 60 bbl, Highest Since Mid

Brent Crude futures rose 41c to 66.57 bbl.

"Geopolitical risks are clearly back on the crude oil agenda after having been absent nearly entirely since the oil market ran into a surplus in the second half of 2014", Bjarne Schieldrop, chief commodities analyst at SEB, said, also citing Kurdistan and Libya.

Anti-government protests in Iran have fueled uncertainty in the global oil market. But prices have rallied almost 50 percent since the middle of the year on robust demand and strong compliance with the production limits.

Lipow said he expected USA crude prices to creep up to around $63 a barrel by the end of next year, while Brent would remain around $67 a barrel as US oil exports rise to record levels.

U.S. West Texas Intermediate (WTI) crude futures traded 20 cents lower at around $60.22 a barrel by 11:34 a.m. EST (1634 GMT). The session high of $67.29 was the highest since May 2015.

Brent Crude is up 17% since the beginning of the year and WTI Crude Oil finished 12% higher.

Federal Reserve Bank insists oil must exceed $60 for a boost in US drilling.

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Analysts expect United States production to top 10-M BPD in the next few weeks and to keep growing, limiting efforts by other producers to cap global supplies.

“The U.S. shale impact is now encroaching on uncharted territory, ” analysts at RBC Capital Markets wrote this month, saying it had “redrawn the global crude flow map.”.

WTI prices were further boosted by an EIA report of a 4.6-M bbl weekly drop in United States commercial Crude Oil storage levels. In the last quarter of 2016, Russia's production had hit a post-Soviet era high, while year over year in 2016, production grew to 10.96 million bpd, from 10.72 million bpd in 2015.

October U.S crude production rose 167,000 barrels per day to 9.64 million bpd, according to the EIA's monthly production report.

Even without the unrest in Iran, which is a major oil exporter, market sentiment was bullish.

"The resolution of the North Sea pipeline issue is having the expected result that the Brent-WTI spread is narrowing today", David Thompson, executive vice-president at Powerhouse, an energy-specialized commodities broker in Washington. If the deal holds until the end of this year, Russia's oil production growth could stall, considering its commitment to the pact.

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