Oil down on US output concerns
LONDON, March 12, 2018 – Crude oil prices continued to drop on Monday, as optimism linked to news of a decline in U.S. drilling rigs and upbeat U.S. jobs data was overshadowed by lingering concerns over U.S. output levels ahead of this week’s supply reports.
The U.S. West Texas Intermediate crude April contract was down 51 cents or about 0.82% at $61.53 a barrel by 10:03 a.m. ET (14:03 GMT).
Elsewhere, Brent oil for May delivery on the ICE Futures Exchange in London lost 68 cents or about 1.04% to $64.82 a barrel.
Oil prices were initially boosted after Baker Hughes energy services firm said on Friday that the number of active U.S. oil rigs declined by four last week to 796. It was the first decline in seven weeks.
The commodity also received support after the Labor Department reported on Friday that the U.S. economy added 313,000 jobs last month, beating economists’ forecasts of 200,000. It was the largest monthly increase in one-and-a-half years.
Traders hope more job creation will boost fuel demand.
Market participants were now looking ahead to the American Petroleum Institute’s weekly report on U.S. oil supplies due on Tuesday. The next day, the U.S. Energy Information Agency will release official data on oil and gasoline stockpiles.
Fears that rising U.S. output could dampen global efforts to rid the market of excess supplies persist.
The Organization of the Petroleum Exporting Countries (<a href='https://staging.theenergyyear.com/companies-institutions/opec/’>OPEC), along with some non-OPEC members led by Russia, agreed in December to extend oil output cuts until the end of 2018.
Elsewhere, gasoline futures slid 0.61% to $1.887 a gallon, while natural gas futures were up 2.60% to $2.803 per million British thermal units.