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Brent crude was down 23 cents, or 0.4%, at $61.79 a barrel by
1147 GMT, having gained more than 4% last week, its best weekly
gain since Sept. 20.
West Texas Intermediate (WTI) crude was down 23 cents, or 0.4%,
at $56.43 a barrel, after rising more than 5% last week, also
the biggest weekly increase since Sept. 20.
Profits at Chinese industrial companies fell for the second
straight month in September as producer prices continued to
slide, highlighting the impact of a slowing economy and
protracted U.S. trade war on corporate balance sheets.
Still, traders were optimistic after the U.S. Trade
Representative's office and China's Commerce Ministry said on
Friday that the two countries were "close to finalizing" some
parts of a trade agreement.
"Looking further ahead, if trade talks continue to progress, and
we see full agreement to phase 1 of the deal, this should help
to improve sentiment further," ING analyst Warren Patterson
said.
Analysts say a trade agreement would provide a boost to global
oil demand growth.
U.S. energy companies reduced the number of oil rigs operating
this week, leading to a record 11-month decline as producers
follow through on plans to cut spending on new drilling.
(Graphic: U.S. Rig count,
https://fingfx.thomsonreuters.com/
gfx/editorcharts/US-OIL-RIGS/0H001PBQ55VR/eikon.png)
Russia's energy ministry said that OPEC and its oil-exporting
allies, known as OPEC+, would factor in the slowdown of U.S. oil
output growth when they meet to discuss their output agreement
in December.
However, Russian Deputy Energy Minister Pavel Sorokin said it
was premature to talk about deeper production cuts.
OPEC+ has since January implemented a deal to cut output by 1.2
million bpd to support the market. The pact runs to March 2020
and the producers meet to review policy on Dec. 5-6.
"We are of the view that an extension of current cuts is path of
least resistance for the producer group, while deeper cuts will
be far more difficult to agree on," Harry Tchilinguirian, global
oil strategist at BNP Paribas in London said.
Money managers cut their net long U.S. crude futures and options
positions in the week to Oct. 22, the U.S. Commodity Futures
Trading Commission said on Friday.
(Additional reporting by Aaron Sheldrick in Tokyo; Editing by
Emelia Sithole-Matarise and David Evans)
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