Oil prices whipsawed as an OPEC deadlock raised the prospect that the alliance could fail to come to agreement about limits on production, leading big producers to open the taps.
Futures for West Texas Intermediate, the main grade of U.S. crude, retreated 0.5% to $74.68 a barrel on Tuesday after earlier shooting up to their highest level in six years. Brent crude, the benchmark in global energy markets, skidded 1.7% to $75.85 a barrel having initially rallied when the OPEC meeting was called off on Monday.
Crude prices have advanced almost 60% this year, a surge powered by a revival in consumption of fossil fuels as vaccines roll out and major economies unlock. The Organization of the Petroleum Exporting Countries and its allies, led by Russia, have continued to hold millions of barrels a day in the ground each day, limiting supplies.
Investors have also played a role in pumping up prices, snapping up futures and options contracts to bet they will keep marching higher.
Drivers are feeling the pinch at the pump. Heading into the July 4 weekend, Americans faced the steepest gasoline prices in nearly seven years at a national average of over $3 a gallon.