Oil futures climbed on Friday and for the week, boosted by signs of tighter supply in the wake of the move by major OPEC oil producers to cut output from the start of this month.
Gold and sliver also rose, but copper saw a solid fall over the week, despite record Chinese imports in 2016.
Oil prices, however, finished off the day’s highs after data showed a sharp weekly rise in the number of active US rigs drilling for oil.
The increase again raised concerns that rising output from the US could very well derail efforts by the move by OPEC, Russia and other producers to rebalance global oil supply and demand.
The International Energy Agency believes the OPEC cuts and faster economic growth will mop up the oil and oil product surplus as the year goes on.
But the rise in drilling activity last week tells us that US companies have taken the price move back over $US50 a barrel as enough to justify a stepped up pace of drilling acivity and fracking.
Data from Baker Hughes on Friday revealed that the number of rigs in the US drilling for oil jumped higher by 29 to 551 rigs last week. The oil rig count had edged lower the week before, but rose in each of the 10 previous weeks.
The total active US rig count, which includes oil and natural-gas rigs, also rose by 35 to 694, according to Baker Hughes.
The oil rig count is now at its highest level in 14 months and the number of oil rigs have climbed 8% since last year, but is still down by nearly 66% from their peak in October 2014.
As a result, US West Texas Intermediate futures rose by $1.05, or 2%, to settle at $US52.42 a barrel after trading as high as $52.90.
The contract, which expired at Friday’s settlement, finished up 0.1% higher for the week. March WTI crude settled at $US53.22, up $1.10, or 2.1%, ending just above last Friday’s finish of $US53.15.
In London, March Brent crude rose by $US1.33, or 2.5%, to $US55.49 a barrel—settling less than 0.1% higher for the week.
Gold futures prices climbed Friday, adding to a weekly gain—the fourth in a row—helped by weakness in the US dollar and more uncertainty surrounding Donald Trump’s presidency.
Trump’s swearing in on Friday and his aggressive post inauguration speech worried markets and triggered a slide in the value of the greenback and boosted some commodities.
That was after gold had been hit hard on Thursday by the US dollar rising off the back of inaction on rates by the European Central Bank and hawkish comments about the pace of US rate rises by Fed chair, Janet Yellen.
On Friday, the uncertainty surrounding the early presidency of Trump hovered over financial markets.
Comex gold for February delivery rose $US3.40, or 0.3%, to settle at $US1,204.90 an ounce.
Gold on Tuesday finished at its highest level since November 17, according to data from FactSet, and that surge move helped preserve the week’s advance of 0.7%.
Comex March silver added 3 cents, or 0.2%, to $US17.032 an ounce, for a 1.6% weekly gain. In contrast Comex March copper rose 1.5 cents, or 0.6%, to $US2.625 a pound—but that was a weekly loss of 2.4%.
