Oil futures fell on Friday, after reaching two-month highs on Thursday on renewed hopes for a continuation of the OPEC production cap and progress on the US-China trade war.
As a result, global oil prices ended the week for small losses.
West Texas Intermediate crude for January delivery fell 81 cents, or 1.4%, to settle at $US57.77 a barrel in New York, while in Europe, January Brent crude, lost 58 cents, or 0.9%, at $63.39 a barrel.
The WTI contract ended 0.1% lower for the week, while Brent saw a weekly gain of roughly 0.1%.
Both front contracts had ended Thursday at their highest levels in two months (since September 23).
Last week saw news reports claiming OPEC and its allies, particularly Russia, are expected to agree to extend existing output curbs of 1.2 million barrels a day, scheduled to end in March, through to the northern autumn, when they meet in Vienna next month.
And there is more concern about the US production outlook with Baker Hughes on Friday reported a fifth consecutive weekly fall in the US. oil-rig count. The number of active rigs drilling for oil in the US fell by 3 to 671 last week.
The number of active oil rigs in the US is now down 214 from a year ago while the number of active gas rigs is down 65 to 129. Total rig numbers are down 276 to 803.
In its latest short term energy outlook, America’s Energy Information Administration forecasts US crude oil production will increase to 12.3 million b/d this year from 11.0 million b/d in 2018. EIA expects the growth rate to decline from 11.8% in 2019 to 8.1% in 2020.
The EIA said it “expects WTI-Cushing crude oil prices to stay below $55/b until August 2020, EIA anticipates that drilling rigs will continue to decline as producers cut back on their capital spending, resulting in notable slowing in the growth of domestic crude oil production over the next 14 months.”
The EIA said US daily production averaged 12.8 million barrels last week – and the cumulative average daily figure so far this year was 12.235 million barrels.
US oil stocks rose by 1.4 million barrels to just over 450 million barrels, around 3% above the average for the past five years, according to the EIA.
Meanwhile, gold futures were unchanged on Friday, ending the week with a small loss, unlike silver, gold and iron ore (see separate story).
Comex December gold settled unchanged on Friday, at $US1,463.60 an ounce after trading as high as $US1,473.40 during the session.
That was after it settled Thursday at its lowest since November 13, according to FactSet.
December silver lost 6.5 cents, or 0.4%, to end at $US17 an ounce, after easing 0.3% on Thursday.
Over the week, gold saw a 0.3% weekly loss but silver rose 0.3%.
Comex December copper rose 0.9% to $US2.648 a pound on Friday for a 0.4% gain for the week.
