A recent rally showed signs of slowing as oil prices settled a little lower on Friday, following closely-observed data projected a jump in U.S. drilling activity.
Baker Hughes, an oilfield services firm reported that the figure of active U.S. rigs drilling for oil production jumped by nine to 738 in the previous week with the underlying worry that U.S. producers will drive the output to prices standing near 28-month highs.
Brent crude futures, the benchmark for outside-the-U.S. prices, declined 41 cents, or about 0.7%, to settle at $63.52 a barrel. During the midweek, it rallied to $64.65, an unreached level since 2015.
The global benchmark closed the week with an approximately 2.4% increase, the fifth weekly gain in a row.
Meanwhile, the U.S. West Texas Intermediate (WTI) crude futures dipped 43 cents, estimated around 0.8%, to close at $56.74 a barrel by end of trade. It reached $57.92 on Wednesday, its best level since July 2015.
This ended up a fifth-straight week, ending around 2 % higher for the week.
An important barometer for the drilling industry is the weekly rig count, where it serves as a representation for domestic oil production.
In early October, the oil’s rally began where it has been largely pushed by expectations that countries producing oil will agree to extend an output deduction at their end of the month meeting.
Energy Trading and OPEC Discussions
As the Nov. 30 meeting is coming up, discussions are continuing, wherein oil ministers from OPEC and the non-OPEC countries in participation will attend.
Despite ongoing unrest in the Middle East and heightening tensions between Saudi Arabia and Iran, prices showed a boost in figures. Among the world’s top producers of oil as well as OPEC’s most influential member is Saudi Arabia.
Energy trading on Friday like gasoline futures declined 0.7 cents, about 0.4%, to close at $1.812. For the week, it closed up around 1.1% which is its fifth-straight weekly advance.
Booking its fifth weekly climb in a row will be heating oil, which slumped 1.2 cents, or 0.6%, at $1.943 a gallon, a 2.6% weekly increase.
Natural gas futures traded around 7.7% above the usual for the week, marking its second straight weekly advance while it posted on 1.3 cents, or a reach of 0.4%, to settle at $3.213 per million British thermal units.
Market participants will keep an eye on fresh weekly information in the week ahead about U.S. stockpiles of refined products and crude on both Tuesday and Wednesday to estimate the demands strength within the oil consumer giant.
Monthly reports from the Organization of Petroleum Exporting Counties and the International Energy Agency will be zeroed in by the oil traders in order to assess global oil supply and levels of demand.
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