Oil drops as investors take profit
Early on Tuesday, oil tumbled, as market participants were busy with taking profits reacting to the overnight soar. To some extent, it underscored the surging mixed views that major oil producers could come to a compromise as for an output freeze on recent Sunday.
For the first time in three weeks American crude benchmark managed to settle above $40 per barrel, while the global Brent benchmark hit a four-month high on Monday, due to a weakening greenback as well as higher anticipation that key crude players, including Saudi Arabia and Russia would perform a mutual production freeze in order to revive prices.
Though American oil managed to hold on by floating above $40, it lost up to 30 cents in New York, while June Brent futures lacked just 15 cents, trading at $42.68 in London.
Expectations for something extraordinary to take place in the upcoming Doha negotiations is probably mounting, especially considering the absence of news of a cancelation has been carried out. Evidently, higher crude prices generated by the Doha negotiations would be good for crude producers.