Oil Prices Tumble 2% on Rising U.S. Rig Count

Investing.com – Oil prices tumbled to start the week on Monday, after data showed that U.S. energy firms added rigs for the first time this year.

In a sign that output could rise further, Baker Hughes reported Friday that the number of domestic rigs drilling for oil rose by 10 to in the week to Jan. 25.

U.S. futures for March delivery on the New York Mercantile Exchange slumped $1.08, or around 2%, to $52.61 a barrel by 8:30AM ET (13:30 GMT).

Elsewhere, for April delivery on the ICE (NYSE:) Futures Exchange in London sank $1.07, or about 1.7%, to $60.52 a barrel.

is likely to stay in the headlines this week, as turmoil in Caracas triggered concerns that its crude exports could soon be disrupted.

Amid violent street protests, Venezuela’s opposition leader Juan Guaido declared himself interim president last week, winning backing from Washington and large parts of Latin America, including Brazil and Colombia.

That prompted Nicolas Maduro, the country’s leader since 2013, to cut ties with the U.S., which signaled it could impose sanctions on Venezuela’s oil exports.

Developments in Venezuela take on an even greater importance for the oil market considering that the country holds the rotating presidency of OPEC this year, analysts stressed.

After ending 2018 in freefall, oil has gained roughly 15% since the start of January, the largest increase in percentage terms in the first month of the year since 2005.

Overall, the recent advance for the energy complex has been powered by evidence of a decline in global output.

Saudi Arabia-led OPEC and its non-member allies led by Russia agreed to collectively cut production by a total of 1.2 million barrels per day (bpd) during the first six months of 2019 in an effort to stave off a global glut in supplies.

In other energy trading, dropped 1.7% to $1.381 a gallon, while fell 1.5% to $1.859 a gallon.

plunged 5.8% to $2.893 per million British thermal units, on the back of changing winter weather forecasts.

— Reuters contributed to this report

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.