Oil price nears $75 a barrel

Image copyright Reuters Image caption The latest reports of the fall are likely to send crude futures sharply lower

Oil prices have fallen below $76 a barrel.

The price of Brent crude, the international benchmark, is down nearly 2% at $75.92, while US West Texas Intermediate (WTI) crude is lower by 1.8% at $74.62 a barrel.

Prices reached a four-year high of $86 in October, but then fell by more than a third as investors decided that Saudi Arabia and Russia might be trying to drive them up.

All three have emphasised that production cuts are set to continue at least until the end of 2018.

Those who have predicted the crash of oil prices are now blaming the former US vice-president, Joe Biden, for apparently encouraging a drop in oil prices in 2016.

Russia and Saudi Arabia were said to have told Mr Biden that oil prices needed to drop to $35 a barrel in order to make US shale-oil producers more interested in investing.

This initiative apparently took place when both oil ministers met in Turkey in December 2016.

US shale producers added a level of uncertainty to the global oil market when it started pumping more oil after international sanctions against Iran were lifted in January 2016.

They often do not hold production at a fixed level, in the hope that prices will fall.

Last year the US became the world’s biggest oil producer as a result of a rise in output following advances in shale oil drilling techniques.

However, prices later rose sharply after Russia and Saudi Arabia agreed to extend the oil cut agreement until the end of the year, amid fears the market was already oversupplied.

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