Oil falls from 6-month high on signs market not as tight as feared

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Oil prices fell on Wednesday after a report allayed concerns about tightening su...

LONDON - Oil prices fell on Wednesday after a report allayed concerns about tightening supply, ending a rally that took prices to their highest since early November on concerns that OPEC output cuts and sanctions would take too much oil out of the market.

The International Energy Agency , a watchdog for oil consuming countries, said in a statement on Tuesday that markets are “adequately supplied” and that “global spare production capacity remains at comfortable levels.” Brent crude futures were at $74.18 per barrel at 0848 GMT, down 33 cents from their last close. It was the benchmark’s first fall after three days of rises, but it is still set for its fifth consecutive weekly gain.

Crude oil prices for spot delivery rallied after the United States said on Monday it would end all exemptions for sanctions against Iran, demanding countries halt oil imports from Tehran from May or face punitive action from Washington.The spot price surge has put the Brent forward curve into steep backwardation, in which prices for later delivery are cheaper than for prompt dispatch.

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