Oil Prices Head Lower Ahead of U.S. Rig Count Data

Investing.com – Oil prices traded lower in midmorning trade on Friday as investors looked ahead to the latest publication of U.S. drilling activity

New York-traded fell 55 cents, or about 0.8%, to $67.49 a barrel by 10:49AM ET (14:49GMT).

Meanwhile, , the benchmark for oil prices outside the U.S., was last down 84 cents, or 1.1%, to $76.72.

Crude has been under pressure recently as traders fret over the uncertainty of continued production curbs under the auspices of the Organization of Petroleum Exporting Countries (OPEC) and Russia.

Saudi Arabia and Moscow have discussed in the second half of the year by some 1 million barrels per day (bpd) to make up for potential supply shortfalls from Venezuela and Iran. The former is going through an economic crisis and the later has been hit by sanctions from the U.S.

U.S. sanctions against Iran, which produces 4% of global oil supplies are expected to cause shortages later this year. Production in Venezuela has also plunged to its lowest level in decades.

OPEC and some non-OPEC producers will meet on June 22 to review their commitment to curb output by about 1.8 million barrels per day until the end of this year. Any signs that the group may be end the agreement early would weigh on prices.

Oil also saw selling pressure this week as the Energy Information Administration (EIA) said that U.S. crude production jumped 215,000 barrels per day (bpd) to 10.47 million bpd in March, a new monthly record.

Later on Friday, investors will watch the latest on U.S. drilling activity. U.S. drillers added 15 oil rigs last week, bringing the total count to 859, the highest number since March 2015.

The Organization of the Petroleum Exporting Countries (OPEC) and other non-OPEC members including Russia may start to increase their supply as well.

U.S. crude has fallen around 2% this week, although Brent has managed to hold onto gains of about 0.3%.

In other energy trading, fell 1.3% $2.1372 a gallon 10:51AM ET (14:51GMT), while sank 1.3% to $2.1751 a gallon.

Lastly, traded down 0.3% to $2.942 per million British thermal units.

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