Oil is heading for the biggest weekly gain since mid-September after United States crude stockpiles extended declines and as the the head of Organization of Petroleum Exporting Countries (Opec) said a market rebalancing is under way.
Futures were little changed in New York, up 3 percent for the week. US crude supplies fell by 2.75 million barrels last week, according to Energy Information Administration (EIA) data on Thursday. Opec expects efforts to clear the global glut with its allies, including Russia to succeed by the end of the third quarter of next year, according to people familiar with the group’s internal forecasts.
Oil has rebounded from the biggest weekly loss since May on signs that output cuts led by the Opec are draining a surplus. The International Energy Agency predicts progress on clearing the glut may stall next year, while Opec Secretary-General Mohammad Barkindo said Sunday that further steps might be needed to sustain the recovery into 2018.
West Texas Intermediate for November delivery was at $50.75 a barrel on the New York Mercantile Exchange, up 15 cents, at 8:04 a.m. in Hong Kong. Total volume traded was about 74 percent below the 100-day average. Prices slid 70 cents to $50.60 on Thursday, dropping for the first time in four sessions.
Brent for December settlement was at $56.44 a barrel on the London-based ICE Futures Europe exchange, up 19 cents. Prices are up 1.5 percent this week. The global benchmark crude traded at a premium of $5.37 to December WTI.
Image credits: Luke Sharrett/Bloomberg