Oil prices surged by as much as 30 cents a barrel on U.S. markets Monday to the highest level since January, 1986, as refiners snapped up crude to meet rising gasoline demand. Oil issues listed on U.S. exchanges advanced strongly.
Petroleum Intelligence Weekly reported that OPEC exceeded its self-imposed production ceiling in April by nearly 1 million barrels, but analysts said demand still is strong for the cartel's oil as the West heads into the summer driving season.
Most observers contend that the Organization of Petroleum Exporting Countries is determined to hold production at current levels even though maverick members Iraq and the United Arab Emirates are flouting their output quotas.
In December, OPEC agreed to cut production by 7.2% to 15.8 million barrels a day for the first half of 1987 in order to raise oil prices to an official average of $18 a barrel.