Oil is still surging

Oil is rallying again on Tuesday.

Both Brent and West Texas Intermediate crude oil are continuing their rallies, with Brent up 4.4% to above $US57 a barrel while WTI prices are higher by more than 5% to around $US52.50 a barrel. 

In the last three days, WTI prices are up more than 16%, a rally that was kicked off by an 8% gain for both WTI and Brent on Friday, the biggest one-day gain since 2009. 

Of course, oil prices are still down about 50% since their peaks hit in June.

Here’s the chart of Brent over the last week.

There have also been suggestions that low prices could have an impact on future supply.

Tuesday, BP announced it would cut $US20 billion in capital spending (the money invested in new exploratory projects) as the British giant is feeling the pain of low oil prices. The company reported quarterly profits for $US2.2 billion, better than the $US1.5 billion forecast but much less than the $US2.8 billion in the third quarter of 2014. 

At the same time, there are still plenty of reasons to be cautious about an end to the oil decline. 

Business Insider’s Akin Oyedele on Monday highlighted four reasons for not being bullish about oil prices, forecasting further losses later in 2015. 

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