June 7, 2016 1:56 pm
Updated: June 7, 2016 2:36 pm

Price of oil settles above US$50 for 1st time in almost a year

The price of oil has settled above US$50 a barrel for the first time in nearly a year.

AP Photo/Jae C. Hong, File

TORONTO – The price of oil has settled above US$50 a barrel for the first time in nearly a year.

READ MORE: Should Canadians be cheering for lower or higher oil prices?

The July benchmark contract for West Texas Intermediate crude closed Tuesday at US$50.36, an increase of 67 cents from the previous day.

That’s the first time oil has settled above the US$50 mark since last July.

“$50 is a big psychological hurdle for crude oil, and it’s one that it’s been bumping up against for a couple of weeks now,” said Colin Cieszynski, chief market strategist at CMC Markets Canada.

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“To see it break through is very encouraging and suggests that there is enough support to keep carrying crude oil higher.”

In February, oil settled as low as US$26.21 a barrel.

“It’s a pretty spectacular move in a fairly relatively short period of time,” Cieszynski said.

Canada’s economy has been hit hard by a rapid and deep decline in global oil prices that began in late 2014.

READ MORE: 5 reasons oil prices are rising

Crude prices have gradually risen in recent weeks due to several factors, including the wildfires in Fort McMurray, Alta., which at one point may have taken out as much as half of Canada’s total oilsands production, according to some estimates. Those operations have gradually started to come back online.

Militant attacks on pipeline infrastructure in Nigeria have also caused supply disruptions in the oil-producing country.

© 2016 The Canadian Press

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