NYMEX crude gaisn in Asia on U.S. rig count drop

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Investing.com - Crude oil prices gained in Asia on Monday with the front-month contract up following a drop in U.S. drilling activity last week.

On the New York Mercantile Exchange, crude oil for delivery in March gained 0.85% to $32.02 a barrel.

Last week, oil prices fell sharply on Friday, as market players continued to focus on a global supply glut and amid doubts over the likelihood of a collective cut happening anytime soon.

On Friday, consultant Baker Hughes said the U.S. rig count fell by 26 to 413 in the week ended Feb. 19.

But the U.S. Energy Information Administration said Thursday that U.S. crude stockpiles increased by 2.1 million barrels last week to an all-time high of 504.1 million barrels, underlining concerns over a domestic supply glut.

Supplies at Cushing, Oklahoma, the key delivery point for Nymex crude, rose by 36,000 barrels last week, raising fears that the nation's largest storage facility is nearing full capacity.

Elsewhere, on the ICE Futures Exchange in London, Brent oil for April delivery slumped $1.27, or 3.7%, on Friday to close the week at $33.01 a barrel.

On the week, London-traded Brent futures declined 35 cents, or 1.04%, the third consecutive weekly drop. Futures were up as much as 14% earlier in the week on Saudi Arabia and Russia's agreement to freeze output at January levels.

Brent prices pushed lower on Friday as investors expressed skepticism that the deal could be completed. While Iran oil minister Bijan Zanganeh said that he supported any measure that would help stabilize global oil markets, he stopped short of committing to a freeze in Iranian production, raising the question of whether the agreed parties will stay committed to the plan.

Brent prices are down almost 12% in 2016 as investors worried that a huge oversupply in crude was coinciding with a global economic slowdown.
Oil futures are down nearly 70% since the summer of 2014. Global crude production is outpacing demand following a boom in U.S. shale oil and after a decision by OPEC last year not to cut production in order to defend market share.

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