Oil price reaches $70 for first time since 2014

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Oil topped $70/bbl in London for the first time in three years as production cuts by OPEC and rising demand whittle away a global surplus, World Oil reports.

Brent crude futures, used in the pricing of more than half the world’s oil, rose as much as 1.2% to the highest since Dec. 4, 2014. Prices rallied after the longest stretch of declines in U.S. inventories during winter in a decade. Prices have also been supported by concerns that supply disruptions could stem from rising political tensions in OPEC members Iran and Venezuela.

Brent for March settlement advanced to $69.90/bbl on the London-based ICE Futures Europe exchange at 11:28 Eastern time. But with the climb in crude, there are growing signs that OPEC could be falling into a trap it had sought to avoid. OPEC’s members aren’t keen on Brent prices above $60/bbl because of the potential for more U.S. shale output, Iran’s Oil Minister Bijan Namdar Zanganeh said recently.