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Crude oil dropped from the highest close in two days after Norway ended a strike by energy workers that had threatened to halt production by western Europe’s largest crude exporter.
Futures slipped as much as 1.1 percent in New York after the Norwegian government ordered compulsory arbitration in the dispute, preventing a lockout of platform workers that was scheduled to start at midnight yesterday. Norway pumped 1.63 million barrels of oil a day in May, or about 1.8 percent of global consumption, data from the Norwegian Petroleum Directorate show.
“Traders are probably taking the premium out of oil now that they think the strike will be settled,” said David Lennox, an analyst at Fat Prophets in Sydney. “It was looking like the strike was going to deteriorate further. That risk premium is certainly coming out of crude.”
Oil for August delivery fell as much as 98 cents to $85.01 a barrel in electronic trading on the New York Mercantile Exchange and was at $85.15 at 11:05 a.m. Sydney time. The contract climbed 1.8 percent yesterday to $85.99, the highest close since July 5. Prices are 14 percent lower this year.
Read the entire Bloomberg article