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Worst of oil rout ‘is over’, say analysts (as Shell begins £20bn asset sale)

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Oil analysts say the price of a barrel may have bottomed out – just as Shell started a £20billion assets sale.

The International Energy Agency said a slowdown in oil production could mean the worst of the rout in oil prices is over. In January prices plummeted to 12-year lows, falling below $27-per-barrel.

But in recent weeks there has been a modest recovery, with oil rising to $40 per barrel, and the IEA said this could be the light at the end of the tunnel.

‘There are clear signs that market forces are working their magic,’ the IEA said. 

‘For prices there may be light at the end of what has been a long, dark tunnel, but we cannot be precisely sure when the oil market will achieve the much-desired balance.’

The IEA’s comments came as Shell (up 30.5p to 1669p) began selling assets worth £20billion. 

The oil giant appointed Lazard, Morgan Stanley and Bank of America Merrill Lynch to advise it on the disposals which will finance last month’s £36billion takeover of BG Group.

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