|
 Heating oil <HOc1>, a proxy play for diesel, also fell almost lost 2
percent while gasoline <RBc1> lost more than 1 percent on concerns
of outsized U.S. supply despite forecasts for a spike in driving
this weekend and through Monday's Memorial Day holiday.
Worries that fewer U.S. oil rigs were being idled after a broad
rebound in crude prices since early April further weighed on
sentiment. Drillers cut the number of U.S. oil rigs in operation by
just one this week, the strongest sign yet that a nearly six-month
slump in activity was ending, data from oil services firm Baker
Hughes showed.
U.S. crude <CLc1> settled down $1, or 1.7 percent, at $59.72. It
rose 3 cents for the week though, extending weekly gains for a 10th
straight week.
North Sea Brent oil <LCOc1>, a more widely referenced benchmark,
settled down $1.17, or 1.8 percent, at $65.37 a barrel. Brent fell
2.1 percent on the week.
The dollar traded at a near one-month high after Federal Reserve
Chair Janet Yellen said she expected the central bank to raise rates
this year as the U.S. economy was on course to rebound from a
sluggish first quarter and as headwinds at home and abroad begin to
wane. A U.S. inflation report also indicated underlying price
pressures that could prompt a rate hike.
A stronger greenback makes dollar-denominated commodities less
affordable to holders of the euro and other currencies. Traders said
oil was particularly vulnerable to profit-taking after the gains of
the past two days in which Brent had risen 4 percent and U.S. crude
6 percent.
"No one wants to hold open positions ahead of a long weekend so
books are being squared, bringing some consolidation," said Carsten
Fritsch, senior oil and commodities analyst at Commerzbank in
Frankfurt.
[to top of second column] |
The American Automobile Association said U.S. road travel was
expected to reach a 10-year high over the Memorial Day weekend,
suggesting strong fuel consumption over the next three days.
But analysts said gasoline supplies may be too high to see any
bullish impact from such usage.
"The refineries have cranked out more gasoline and fuel products
than required in the near term, and that's weighing on the petroleum
complex," said Andrew Lipow, president of Lipow Oil Associates in
Houston.
(Additional reporting by Christopher Johnson in London and Florence
Tan in Singapore; Editing by Meredith Mazzilli and Jonathan Oatis)
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