Oil prices continued their steady uptick Wednesday, rising above $51 per barrel amid turmoil in Nigeria, early signs of a reawakening U.S. market and declining global inventories.
The price of West Texas Intermediate crude, the U.S. benchmark, rose 1.3% to $51.03 at 7:54 a.m.
The commodity hasn’t settled above $51 since July 15, when it hit $51.41, according to the Oil Price Information Service.
“The past few weeks have clearly shown that the U.S. rig count has bottomed in the Baker Hughes data,” Marin said. “The next question becomes, how confident are the operators in the sustainability of oil prices at these levels?”
This week’s boost in prices can be attributed partially to unrest in Nigeria, where militants have attacked oil facilities, causing supply disruptions, according to JBC Energy.
Traders are also encouraged at declining global crude inventories. The U.S. Energy Information Administration will distribute its weekly oil inventories report Wednesday morning, providing additional fodder for investors seeking insight into oil’s trajectory.
To be sure, however, few analysts expect oil prices to increase significantly. Capital Economics analysts recently projected that oil would retreat to $45 per barrel by the end of 2016.