U.S. crude oil prices reached above the $51 mark for the first time since May. Oil has continued a rally that began in the wake of the devastation of Hurricane Harvey that forced the shutdown of many key refineries in the Gulf Coast.
The Organization of the Petroleum Exporting Countries held a key meeting last Friday to decide whether a halt in production would last into 2018. The producers have agreed to a cut of 1.8 million barrels per day since the beginning of 2017. The Russian energy minister said OPEC did not agree on a freeze beyond March 2018, making it a key date for the oil industry. Nigeria, UAE, Iran, and other countries agreed to maintain levels below a certain threshold.
The production cuts have clashed with rising output from the U.S. and Canada, which has consistently put downward pressure on prices even after the OPEC production halt. Shares of producer Suncor Energy Inc. (TSX:SU)(NYSE:SU) were up 1.31% at the top of the noon hour on September 25. Husky Energy Inc. (TSX:HSE) stock climbed 0.85% during the same period. It has also climbed 6.4% over a 1 month span dating to late August.
Some analysts are concerned that this rapid rally will meet the same fate of the jump seen in late July. Some key OPEC members want a decision on a production halt in 2018 to happen before the year begins. With North American producers showing no signs of slowing down the next meeting could again be key for oil.