Oil prices down after S Arabia says has restored supply

LONDON: Oil prices cooled on Wednesday as Saudi Arabia’s pledge to quickly restore production eased supply worries, while caution ahead of an expected US interest rate cut kept wider financial markets in tight ranges.

Brent crude futures dipped 0.5% to $64.23 a barrel, having conceded a chunk of their gains made after the weekend attack on Saudi Arabian oil facilities, international media reported.

Saudi Energy Minister Prince Abdulaziz bin Salman on Tuesday sought to reassure markets, saying the kingdom would restore its lost oil production by month-end having recovered supplies to customers to the levels they were prior to the weekend’s attacks. The comments prompted oil prices to tumble 6% on Tuesday. “I would think a spike in oil prices will likely prove to be short-term given that the global economy isn’t doing too well,” said Akira Takei, bond fund manager at Asset Management One. Still, heightened geopolitical tensions underpinned oil as well as some safe-haven assets such as U.S. bonds.

In New York, the oil price fell more than 2% to $57.88 per barrel in midday trading. Brent crude, the international benchmark, fell 2% to $63.16 per barrel.

The attack on Saudi Aramco’s processing facility in Abqaiq pushed crude prices up more than 14% Monday, a spike equivalent to the Iraq invasion of Kuwait before the 1991 Gulf War.

Average gasoline prices in the US were $2.65 for a gallon of regular Wednesday, up from $2.59 on Tuesday and $2.56 a week ago.