Investing.com – Oil prices rallied on Friday, lifting the U.S. benchmark to its highest finish in nearly eight months and sending the global crude benchmark above $60 a barrel for the first time in more than two years amid expectations that major global producers will extend a deal to curb production beyond its current expiry date next March.
The ahead of OPEC’s next policy meeting by Saudi Arabia and Russia declaring their support for extending a global deal to cut oil supplies for another nine months, OPEC’s secretary general said on Friday.
Saudi Arabia’s Crown Prince Mohammad bin Salman said earlier in the week he was in favor of extending the term of the agreement for nine months, following on from similar remarks by Russian made by President Vladimir Putin at the start of October.
Under the original terms of the deal, OPEC and 10 other non-OPEC countries led by Russia agreed to cut production by 1.8 million barrels a day (bpd) for six months. The agreement was extended in May of this year for a period of nine more months until March 2018 in a bid to reduce global oil inventories and support oil prices.
Discussions are continuing in the run-up to the Nov. 30 meeting, which oil ministers from OPEC and the participating non-OPEC countries will attend.
U.S. West Texas Intermediate (WTI) surged $1.26, or around 2.4%, to end at $53.90 a barrel by close of trade. It reached its best level since March 1 at $54.20 earlier in the session.
For the week, WTI prices rose $2.06, or about 4.7%, the third-straight weekly gain.
Meanwhile, futures, the benchmark for oil prices outside the U.S., added $1.14, or roughly 1.9%, to settle at $60.44 a barrel. It touched an intraday peak of $60.65, a level not seen since July 2015.
The global benchmark ended the week with an increase of approximately 4.7%.
Rising U.S. crude production remains an issue for OPEC as it strives to clear a global supply overhang.
Oilfield services firm Baker Hughes said Friday that its weekly count of oil rigs operating in the U.S. , snapping three consecutive weeks of declines.
The weekly rig count is an important barometer for the drilling industry and serves as a proxy for domestic oil production.
In other energy trading Friday, advanced 1.8 cents, or 1%, to end at $1.768 on Friday. It closed up around 5.4% for the week.
rose 2.5 cents, or 1.4%, at $1.866 a gallon, ending roughly 3.5% higher for the week.
sank 8.7 cents, or 2.9%, to settle at $2.964 per million British thermal units. It fell 5.6% for the week.
In the week ahead, market participants will eye fresh weekly information on U.S. stockpiles of crude and refined products on and to gauge the strength of demand in the world’s largest oil consumer.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Tuesday, October 31
The American Petroleum Institute, an industry group, is to publish its weekly report on U.S. oil supplies.
Wednesday, November 1
The U.S. Energy Information Administration is to release weekly data on oil and gasoline stockpiles.
Thursday, November 2
The U.S. government is set to produce a weekly report on natural gas supplies in storage.
Friday, November 3
Baker Hughes will release weekly data on the U.S. oil rig count.
Source: Investing.com
