NEW YORK, Feb. 12 (UPI) -- Speculation that major world oil producers could at least curb increases caused crude oil prices to soar Friday, though underlying economic pessimism remains.
Several media outlets reported the government of the United Arab Emirates was reviewing potential production cuts alongside other members of the Organization of Petroleum Exporting Countries. Previous rumors of cooperation between OPEC and non-member states caused dramatic spikes in crude oil prices and Friday was no different.
Brent crude oil shot up 5 percent in early Friday trading to $31.61 per barrel in New York. West Texas Intermediate, the U.S. benchmark for the price of crude oil, moved up more than 6 percent to $27.89 per barrel.
Past production-fueled rallies were short lived. Igor Sechin, the head of Russian energy company Rosneft, said earlier this week in London that coordinated reduction could move markets toward what he said were reasonable price levels. He added, however, that key market players were as of now unsupportive of such a move.
Oil prices are low because supplies outweigh demand. U.S. Federal Reserve Chair Janet Yellen this week said a weak energy sector was dragging on economic growth prospects.
While Greece continues to drag on regional growth, the European Union reported fourth quarter gross domestic product grew by 0.3 percent for member states that use the euro to 1.5 percent year-on-year. That beat U.S. growth during the same period by 0.1 percent.
For Europe, industrial production declined 1 percent from November to December, though remained in positive territory in terms of growth for full-year 2015.
In the industry itself, data published Friday from Baker Hughes show new exploration and production activity continued to falter as companies face declining budgets because of the low price of oil. North American rig activity declined 4.25 percent for the week ending Feb. 5.