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Prices started last week above $52 a barrel, then fell sharply in sympathy with a major decline in the equity markets, at one point going below $47. Prices then climbed for the rest of the week, closing just below $52, as investor optimism about an economic recovery increased. Oil prices remained detached from the normal fundamentals such as stocks – which continued to increase last week — and demand, which continued to fall.

As worries about inflation increase, investors are turning back to oil and other commodities as a place to store wealth. This may be preventing a further decline in prices which have been holding around $50 a barrel for several months despite decreasing demand.

OPEC continues to reduce production, though slowly. Iran says it is now meeting more than 90 percent of its official cut. Senior OPEC officials are discouraging the idea that there will be another production cut at the May meeting.