Crude futures settled higher on Friday, capping off a volatile week which saw crude prices rise above $50 a barrel before pairing gains amid renewed concerns over Opec’s compliance with the deal to curb production.
On the New York Mercantile Exchange crude futures for September delivery rose 55 cents to settle at $49.58 a barrel, while on London’s Intercontinental Exchange, Brent added $0.36 to trade at $52.35 a barrel.
Crude oil prices settled lower for the week amid renewed concerns over Opec’s compliance with the deal to curb production, after a survey, earlier this week, showed Opec supplies rose to their highest level of the year so far. That despite the current pact to reduce output by 1.2m barrels per day (bdp).
Opec output hit a 2017 high of 33 million bpd in July, up 90,000 bpd from the previous month, a Reuters survey showed earlier this week, despite the group’s pledge to curb production.
In May, Opec and non-Opec members agreed to extend production cuts for a period of nine months until March, but stuck to production cuts of 1.8 million bpd agreed in November last year.
Concerns over growing Opec production come ahead of a highly anticipating meeting between Opec members on Aug 7-8, as the group seeks to reaffirm its committee to increase compliance with the deal to curb production.
Market participants, however, downplayed the importance of the meeting next week, suggesting oil prices may struggle to sustained upward momentum.
“I think we [oil prices] are going to be relatively range-bound unless we see some kind of weather or political event,” Tariq Zahir, managing member at commodity-trading adviser Tyche Capital Advisors said Thursday.
Meanwhile in the U.S. investors cheered bullish data showing the weekly count of oil rigs operating in the United States ticked down by one rig to a total of 765, oilfield services firm Baker Hughes reported Friday.
The weekly rig count is an important barometer for the drilling industry and serves as a proxy for oil production and oil services demand.