Oil ignored growing US production and settled higher on Friday, following an intraday bounce that wiped out a weekly loss and produced a weekly gain.
Traders said hopes for continuing growth in global crude demand outweighed pressure from concerns over a solid rise in US production and the a rise in the number of active domestic oil rigs.
Friday’s solid rise from mid-session was at odds with a firmer US dollar (which usually sees US dollar commodity prices ease). The stronger dollar saw most metal prices down on Friday (see separate story)
In New York April West Texas Intermediate crude futures rose $US1.15, or 1.9%, to settle at $US62.34 a barrel after a sharp 2.1% spike in the middle of the session for no apparent reason.
Friday’s solid close produced the week’s 0.5% gain.
In Europe, May Brent crude futures rose as well and closed up $US1.09 a barrel, or 1.7% at $US66.21 a barrel. That was its highest finish so far in March and it rose 1.1% for the week.
The International Energy Agency said in its March report on Thursday said that global oil demand should grow by 1.5 million barrels a day, to average 99.3 million barrels a day this year.
That was an upward revision of 90,000 barrels a day, compared with last month’s report. But traders have been concerned about surging US shale output which is forecast to be running at more than 11 million barrels a day by the end of the year against nearly 10.4 million barrels a day last week.
US oil stocks are now at two year lows at 430.9 million barrels, according to the US Energy information Administration.
Drilling services group, Baker Hughes reported Friday that the number of active U.S. rigs drilling for oil rose by four to 800 this week. The oil-rig count had fallen by four last week, marking the first decline in seven weeks.
