Oil prices fell Friday as the Norwegian government intervened and settled a strike between oil workers and companies.
The benchmark U.S. crude fell 4 cents, or 1.2%, to $37.49 a barrel, while gasoline prices slid more than 1 cent to $1.207 a gallon.
Norwegian officials ended the week-long strike Friday by imposing a wage and pension settlement after deteriorating relations between workers and management threatened to shut down much of the country's production, which exceeds 3 million barrels a day. The country is the world's third largest oil exporter.
Traders have been focused recently on two major short-term supply issues.Repair work continues on pipelines feeding Iraq's southern export complex, as periodic sabotage attacks against the industry infrastructure hurt output there. Repairs were completed on one of two major pipelines feeding the country's main southern export terminals, having been damaged in attacks last week. Iraqi exports have ranged between 1.6 million and 1.8 million barrels a day recently. Fellow members of the Organization of Petroleum Exporting Countries have pledged to compensate for any short-term supply disruption, but it remains unclear how long it will take to fully restore exports. Oil prices had fallen about 12% from their record high of more than $42, touched right before OPEC's meeting two weeks ago. Prices briefly fell through $37 last week. Members of the cartel agreed to raise the group's production quota by 2 million barrels a day in July and another half-million barrels a day in August, should that prove necessary. The current ceiling is 23.5 million barrels a day. Market analysts say the move is largely symbolic because the cartel's members are already producing some 2 million barrels a day above their official quotas. Traders bid up prices on short-term supply concerns triggered by strong global demand and terrorist attacks on oil industry personnel and facilities in the Persian Gulf region ahead of the peak summer driving season in the U.S. and Europe.