Brent crude and WTI: Oil prices give up gains from Canada wildfires
Oil prices gave up earlier gains from a huge wildfire in Canada's oil and gas region to trade lower this afternoon.
Brent crude, the global benchmark, fell two per cent to $44.7 per barrel, while West Texas Intermediate crude, the US benchmark, slumped 1.6 per cent to $44.
Read more: Low oil prices pushes Saudi Arabia into economic reform
Oil prices started in the black this morning as a huge wildfire in Canada's oil sand region swallowed up well over a third of the country's typical daily production.
Nevertheless, analysts warned that this wouldn't last long due to the persistent oversupply.
"We believe that support to prices should remain short-lived. The market remains awash with oil as rising Middle Eastern output is more than offsetting declining US shale production and the various temporary disruptions," Norbert Ruecker, head of commodities research at Julius Baer, said.
It comes as Saudi Arabia ousted its long-serving oil minister who was the driver behind Opec's 2014 policy of holding production despite plummeting oil prices.
Read more: Saudi Arabia is acting like a drunken gambler in its oil war
"Saudi Arabia will maintain its stable petroleum policies. We remain committed to maintaining our role in international energy markets and strengthening our position as the world's most reliable supplier of energy," Khalid al-Falih said yesterday.
"We are committed to meeting existing and additional hydrocarbons demand from our expanding global customer base, backed by our current maximum sustainable capacity."