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Crude settles higher but suffers first weekly decline in five weeks

Investing.com -

Investing.com - Crude oil prices continued to trade within a narrow range Friday but ultimately settled higher as traders weighed up OPEC's effort to reduce supply against the rise in crude inventories to record high levels.

Crude futures struggled for direction, despite a spike in early morning trade, amid reports suggesting that The Organization of the Petroleum Exporting Countries (OPEC) could extend an output cut, which commence January, beyond the previously agreed six-month period.

Crude pared its gains in late afternoon trade, following a spike in the dollar and an increase in U.S. weekly rig counts, after oilfield services firm Baker Hughes reported its weekly count of U.S. oil rigs in operation rose by 6 to a total of 597.

The rise in the number of U.S. oil rigs, added to fears that increased drilling activity from U.S. crude producers may severely hamper OPEC's plan to drain the supply glut in order to support crude prices.

On the New York Mercantile Exchange Crude Oil Futures for March delivery settled at $53.40, up 4 cents, while on London's Intercontinental Exchange, Brent gained 8 cents to settle at $55.74 a barrel.

Oil's turbulent end to the week, comes after The Organization of the Petroleum Exporting Countries (OPEC) and other producers, including Russia, released a report on Monday, confirming its members were in high compliance with last year's agreed production cut.

OPEC and other exporters including Russia trimmed output in January by 1.7 million barrels a day - close to the agreed cut of almost 1.8 million barrels per day (bpd).

Energy traders shift attention to next week's agenda, which includes a fresh round of crude inventory updates on Thursday, Feb 23.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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