12 Dec 2008

Price of oil rises 10%

5:20 pm on 12 December 2008

Oil rose in price by more than 10% on Thursday, settling at nearly $US48 a barrel after the head of the Organisation of Petroleum Exporting Countries called for more "severe" production cuts.

In addition, President Dmitry Medvedev said Russia was ready to work with OPEC on possible cuts.

US crude settled at $US47.98 per barrel, up $US4.46, or 10.25%, continuing a rebound from last week. In London, Brent crude settled at $US47.39, up $US4.99.

Oil prices are down almost $US100 from a record peak of $US147.27 per barrel on 11 July.

In remarks published on Thursday, OPEC President Chakib Khelil said the cartel should agree on a more "severe" reduction in output at a meeting next week in Algeria.

Russia will attend the meeting as an observer.