Dubai: Brent crude retreated from its early high on Friday evening after the new king in Saudi Arabia, the world’s biggest exporter of oil, said that he would maintain his predecessor’s policies.
Brent rose as much as 2.63 per cent to $49.80 per barrel in Asian trade, before trading 1.22 per cent higher at $49.20 at 5.22pm after news of demise of King Abdullah Bin Abdul Aziz, fuelling speculation of policy changes in the kingdom’s oil policy.
But King Salman Bin Abdul Aziz, who succeeds the late King Abdullah on the throne, said he would maintain his predecessor’s policies.
“We saw an initial knee jerk reaction early but from there we retraced after the new King said he would follow the same policies,” said Pradeep Unni, senior relationship manager with Richcomm Global Services.
Crude oil shed more than 35 per cent after the Opec decided to maintain its output to counter US shale gas. “The outlook is still on the negative given that Opec won’t cut production and the overall weak demand, so another $6 drop is not so difficult for crude,” said Unni.
