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 Prices received a strong boost from a report by the International
Energy Agency (IEA), which said there were signs lower prices had
begun to curb production in some areas, including North America.
Another report from the University of Michigan spurred a second
rally, due to consumer sentiment being at its highest level in more
than a decade, thanks to low gasoline prices and job gains.
"That Michigan number was significant," said John Kilduff, a partner
at Again Capital LLC. It's a "pretty good harbinger for the economy
going forward."
WTI <CLc1> settled up $2.44 at $48.69 a barrel. Global Brent crude
futures for March <LCOc1> settled up $1.90 at $50.17.
Still, there were headwinds from the dollar. The dollar hit new
multi-year highs versus the euro, which dropped to a record low
after the Swiss National Bank unexpectedly dropped its currency cap
on Thursday. The dollar index <.DXY> was up .28 percent.
Bullish reports on consumer sentiment and production were beset by
several headwinds, making for a volatile market said Tariq Zahir of
Tyche Capital Advisors.
Additionally, while reports may indicate increasing demand, the
global supply glut is still outweighing it, he said. "Demand is on
the increase, it's still not catching up to supply," Zahir said.
[to top of second column] |
In China, the second-largest oil consumer, there were signs of
weakness as the central bank announced new support measures after
data showed a drop in bank lending and foreign investment growth
falling to a two-year low.
Oil prices have dropped by nearly 60 percent since June as
production around the world has soared, outstripping demand at a
time of lackluster global economic growth.
"How low the market's floor will be is anybody's guess. But the
sell-off is having an impact," the IEA said in its monthly report on
Friday. "A price recovery - barring any major disruption - may not
be imminent, but signs are mounting that the tide will turn.
(Additional reporting by Henning Gloystein in Singapore and
Christopher Johnson in London; Editing by Jessica Resnick-Ault, Dale
Hudson,Alan Crosby and Diane Craft)
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