Oil prices slip after entering bull market

london — Oil prices slipped after entering a bull market amid heightened geopolitical tensions in the Middle East.

Crude in New York fell 0.7 per cent as traders cashed in after Monday’s 3.1 per cent surge.

West Texas Intermediate for November delivery was at $51.86 a barrel on the New York Mercantile Exchange, down 36 cents, at 8:46am local time.

Total volume traded was 31 percent above the 100-day average. Prices surged to $52.22 on Monday, more than 20 per cent above their most recent low — a definition of a bull market.

Brent for November settlement dropped 75 cents to $58.27 a barrel on the Londonbased ICE Futures Europe exchange after rising as much as 0.8 per cent earlier. Prices advanced $2.16 to $59.02 on Monday, the highest close since July 2015.

The global benchmark traded at a premium of $6.41 to WTI on Tuesday.

Oil has gained almost 10 per cent this month on forecasts for rising consumption and as members of the Organization of Petroleum Exporting Countries maintain output cuts to drain a global glut.

The market rebalancing has helped flip the futures curve into backwardation, a structure where immediate deliveries of oil are more expensive than longer-dated ones, signaling strong demand.

Meanwhile In Turkey, President Recep Tayyip Erdogan threatened to “close the valves” on oil shipments from Kurdistan after the Iraqi region held a vote on independence.