Saudi Shake-Up Sent Oil Stocks Soaring Today
Crude oil continued its ascent on Monday, building on last week's OPEC fueled gains. The U.S. oil benchmark price, WTI, spiked 3.1% to close at more than $57 a barrel, with the nearly $2-a-barrel gain the highest dollar basis price increase in almost a year. Fueling today's rally was news that Saudi Arabia detained several officials and members of the royal family over the weekend.
The market saw the detentions, which the kingdom made in an anti-corruption crackdown, as a move by recently installed Crown Price Mohammad bin Salman to consolidate his power. Given that he remains firmly committed to OPEC's current policy to support oil prices, the market saw the news as bullish for oil since it increases the likelihood that Saudi Arabia will continue to work to end the oil glut, which could drive prices even higher.
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Source: Fool.com