|
Stock markets worldwide bounced back on Friday after a multi-day
sell-off but remained on track for their biggest weekly losses
in months, while U.S. Treasury yields inched higher and the
dollar held its gains.
The move prompted oil futures to tick slightly higher late in
the day after coming under pressure from a bearish demand
forecast.
The International Energy Agency, the West's energy watchdog said
in its monthly report that the market looked "adequately
supplied for now" and trimmed its forecasts for world oil demand
growth this year and next.
"This is due to a weaker economic outlook, trade concerns,
higher oil prices and a revision to Chinese data," said the IEA,
which advises industrialized countries on energy policy.
Brent crude settled up 17 cents a barrel at $80.43, after
dropping 3.4 percent on Thursday. U.S. crude futures rose 37
cents to $71.34 a barrel.
"The weaker outlook has gotten a raised profile in the market,
but there's potential for a real supply crunch toward the end of
this year," said John Kilduff, a partner at Again Capital
Management in New York. "The demand outlook is hurt right now
because of the situation with the U.S. and China in particular."
Both benchmarks fell for the first time in five weeks, pressured
by a big rise in U.S. inventories and fading concerns about
shrinking global supplies due to looming U.S. sanctions on
Iran's oil exports. U.S. crude was down 3.6 percent on the week,
while Brent crude fell 4.1 percent.
The IEA report is the latest official forecaster to predict
weaker demand ahead and conclude that supply is adequate. The
Organization of the Petroleum Exporting Countries (OPEC) made a
similar move on Thursday.
"The bearish alarm bells are ringing for next year's oil balance
as market players brace for the return of a supply surplus,"
said Stephen Brennock of oil broker PVM.
Additionally, the U.S. oil drilling rig count rose this week for
the first time in four weeks, an indication that production is
rising.
Drillers added eight oil rigs in the week to Oct. 12, bringing
the total count to 869, General Electric Co's Baker Hughes
energy services firm said in its closely followed report on
Friday. <RIG-OL-USA-BHI>
The increase is the biggest weekly gain since mid-August.
Money managers cut their net long U.S. crude futures and options
positions in the week to Oct. 9, the U.S. Commodity Futures
Trading Commission (CFTC) said on Friday. The speculator group
cut its combined futures and options position in New York and
London by 36,652 contracts to 296,456 during the period.
A drop in U.S. oil production this week supported prices. U.S.
Gulf of Mexico producers have cut oil output by 32 percent and
natural gas production by 13 percent as a result of the
lingering effects of Hurricane Michael, the Bureau of Safety and
Environmental Enforcement (BSEE) said on Friday, citing reports
from 27 companies.
The reductions continued as oil and gas companies moved more
workers back to production platforms that were evacuated earlier
in the week. As of Friday morning, nine platforms were still
unoccupied, BSEE said in a daily update, down from 89 platforms
on Wednesday.
(Additional reporting by Aaron Sheldrick and Alex Lawler;
editing by Rosalba O'Brien and Diane Craft)
[© 2018 Thomson Reuters. All rights
reserved.] Copyright 2018 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.
Thompson Reuters is solely responsible for this content.
 |
|
