The continued diplomatic progress towards de-arming Syria of its chemical weapons saw oil prices ease into the end of the week.
Fears in the oil market had dissipated somewhat amid apparent co-operation between the United States, Russia and the Syrian government.
Having reached as high as US$117 last week by Friday’s trading, in London, Brent Crude futures were changing hands below US$112 per barrel. Meanwhile, West Texas Intermediary futures had retreated to US$107.50.
Without the insecurity in the Middle East many experts believe oil prices would be much lower.
Figures from the US Energy Department this week showed a smaller-than-expected draw on America’s stockpiles, and also revealed that production levels in the US are at their highest for nearly 25 years.
American crude production grew by 124,000 barrels to 7.7mln barrels per day, which is over 2mln barrels higher than it was a year ago.
The weekly inventory report revealed a 219,000 barrels draw on the stockpile, however this was around a tenth of the 2.1mln barrel decline experts had predicted.
Elsewhere Saudi Arabia gave another signal that the market is adequately supplied with crude, as it claimed it was ready to supply whatever volumes are needed to meet demand.
This comes after OPEC claimed that the market was well supplied and, separately, the International Energy Agency warned that fuel prices were ‘very high’ for an economic recovery.
Nevertheless the additional risk associated with the Syrian crisis currently renders the oil market fundamentals mute, and whilst potential for an international conflict remains a premium will be priced into oil.