Crude oil traders take a look at rally momentum as Saudi Arabia shakes up key personnel at its oil ministry. File photo by Monika Graff/UPI | License Photo
NEW YORK, May 9 (UPI) -- A rally in oil prices subsided Monday as Canadian wildfires moved away from key production facilities in Alberta, home to some of the world's larger oil fields.
Canadian energy company Suncor had about 10,000 of its employees evacuated from an oil sands operation near Fort McMurray as wildfires rage across the region. The company said the fire moved close to its base operations, but was now moving east, away from the facilities.
"We have routinely brought down assets as part of planned maintenance and safely ramped them back up within days and we believe we can do so in these circumstances," said Steve Williams, Suncor president and chief executive officer, said in a statement late Sunday.
Crude oil prices moved up sharply in overnight trading, but pulled back by the start of trading in New York. The price for Brent crude oil was 1.1 percent lower to $44.85 per barrel early in the Monday session. West Texas Intermediate, the U.S. benchmark price for oil, was down 0.6 percent to start the day at $44.40 per barrel.
April saw crude oil prices move up 25 percent as analysts said the supply-side pressures that pushed oil lower were starting to fade. Underlying economic weakness has surfaced in recent days, notably from weak labor data in the United States, that suggest demand is still below what's needed to take up the volume of crude oil on the market.
The rally may be taking a breather as traders gauge the shakeup in the Saudi government that saw longtime Oil Minister Ali al-Naimi pushed aside. Naimi steered a Saudi oil policy that prioritized lower oil prices as a way to defend a market share from high-cost producers like the United States, which is experiencing a decline in output.
Naimi will be replaced by Khalid al-Falih, the head of state oil company Saudi Aramco. Falih said last year that supply, demand and economic fundamentals would be the governing factors for oil markets.