Oil Surges as Rig Count Falls
Crude prices surged back to a one-week high Friday after the number of working U.S. oil rigs fell to a five-year low.
The move gives momentum back to traders who have bet that a historic collapse in oil prices is forcing the U.S. shale-oil boom to slow down. U.S. producers made their largest cutbacks in five months and have only 614 oil rigs working, the fewest since August 2010, according to oil-field-services provider Baker Hughes Inc.
Light, sweet crude for November delivery settled up 80 cents, or 1.8%, at $45.54 a barrel on the New York Mercantile Exchange. Brent, the global benchmark, settled up 44 cents, or 0.9%, at $48.13 a barrel on ICE Futures Europe.
Bullish oil traders have for months pointed to evidence that supply is coming back into balance with demand. The U.S. Energy Information Administration reported on Wednesday that U.S. production was down 0.4% from last week at 9.1 million barrels a day. It had said earlier this month that production had hit nearly a one-year low in August and would likely keep falling for another year. (by Timothy Puko, Wall Street Journal)
Bullish oil traders have for months pointed to evidence that supply is coming back into balance with demand. The U.S. Energy Information Administration reported on Wednesday that U.S. production was down 0.4% from last week at 9.1 million barrels a day. It had said earlier this month that production had hit nearly a one-year low in August and would likely keep falling for another year. (by Timothy Puko, Wall Street Journal)