Oil Slips as Gushing Wells Take Shine Off Record US Exports

Oil Slips as Gushing Wells Take Shine Off Record US Exports

Oil Slips as Gushing Wells Take Shine Off Record US Exports

Brent crude closed at a 27-month high on Friday over comments from Saudi Arabia that signal the likely extension of supply cut deal by OPEC and Non-OPEC members, as data released by the World Bank projected growth in oil price by 2018.

Saudi Crown Prince Mohammad bin Salman told Reuters he supports extending the agreement, which aims to keep about 1.8 million barrels off the market between January of this year and March, 2018.

The worldwide benchmark for oil prices was trading up $1.05, or 1.8 percent, at $60.35 a barrel at 11:17 a.m. ET (1517 GMT).

USA crude's gains have lagged the global benchmark amid rising domestic output.

The positive trend in the oil sector has helped investor confidence in recent weeks, but additional oil from United States producers continues to present challenges within this more optimistic scenario.

US drillers added one oil rig in the week to October 27, but the rig count fell by 13 for the month, the biggest such decline since May 2016, data showed on Friday.

Oil prices were mainly flat Thursday, as the market held steady in a newfound, higher range for crude.

Friday's announcement of ceasefire between Iraqi forces and the Peshmerga from the country's autonomous northern Kurdish region eased some concerns.

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"What is interesting is that the pop in WTI futures moved above the September 28 high", said David Thompson, executive vice president at Powerhouse, an energy-specialized commodities broker in Washington.

"I think the combination of short-covering and Chevron and Exxon both missing their production guidance for the third quarter has resulted in the market strength today", said Scott Shelton, energy futures broker with ICAP in Durham, North Carolina. Total U.S. crude stockpiles rose by 856,000 barrels, halting four weeks of declines, the EIA said.

American oil production continues to rise and last week saw an additional 1.1 million barrels a day of production.

At last check, Brent +1% at $59.90/bbl and WTI +1.5% at $53.44/bbl.

Echoing sentiments about a so-called Goldilocks number, Tamas Varga with London oil broker PVM said in an emailed market report that USA crude oil production numbers may be the governor on market direction.

Rising U.S. crude production remains an issue for OPEC as it strives to clear a global supply overhang.

Last week the oilfield services firm said that its weekly count of oil rigs operating in the USA fell by seven to 736, chalking up its third straight decline to the lowest level since June.

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