Seoul - Oil fell as US
drilling continued to rise, undermining the potential for even an
extended OPEC output-reduction deal to rebalance the market.
Futures lost as
much as 1.6% in New York after gaining 0.6% last week.
Producers added more
oil rigs to US fields, extending a drilling surge into a 10th month,
Baker Hughes said on Friday. Saudi Arabia is ready to
extend cuts if supplies stay above the five-year average, Energy
Khalid Al-Falih said in an
interview on Bloomberg Television last week.
US oil this month dropped below $50 a barrel for the first time
this year as the nation’s near-
record crude stockpiles and increasing
production weighed on the output reductions by the
Organisation of Petroleum Exporting Countries and its allies.
won’t decide until May whether to prolong the curbs, energy ministers
Alexander Novak will meet this weekend in Kuwait to discuss the deal’s
“The solid weekly gain in US oil rigs continues and the market sees
Bjarne Schieldrop, chief commodities analyst at SEB AB in Oslo. “OPEC
can easily shoot itself in the foot if the cuts lift the long-dated WTI
price, which will drive US shale yet higher and stronger.”
West Texas Intermediate for
April delivery, which expires Tuesday, fell as much as 77 cents to
$48.01 a barrel on the New York Mercantile Exchange and was at $48.20 as
of 11:24. The more-actively traded
May contract dropped as much as 1.1%. Total volume traded was
about 10% below the
Brent for May
settlement declined as much as 71c to $51.05 a
barrel on the London-based ICE Futures Europe exchange. Prices last week
gained 0.8% to end at $51.76. The global benchmark crude traded
premium of $2.48 to May WTI.
US drillers boosted the rig count by 14 to 631 last week, data from
Baker Hughes showed. They have added 106 machines to fields this year.
The nation’s crude
output has climbed to 9.1 million barrels a day, the most since February
last year, according to the Energy Information Administration.
OPEC and its allies improved their collective compliance with cuts last
month as deeper reductions from members offset weaker implementation
from other producers, according to two delegates familiar with the
conclusions of a meeting in Vienna on Friday.
Libya’s crude shipments from Es Sider and Ras Lanuf ports will restart
in one week to 10 days, Jadalla Alaokali, a board member at National Oil
Corp., said by phone.
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