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UPDATE 11-Crude drops more than 11 percent in week as supply weighs

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* Oil down more than 10 percent this week

* U.S. oil drillers add 10 rigs to 883 in week -Baker Hughes

* OPEC to publish details of output cut quotas

By Jessica Resnick-Ault

NEW YORK, Dec 21 (Reuters) - Oil prices fell on Friday totheir lowest since the third quarter of 2017, heading for lossesof more than 11 percent in a week, as global oversupply keptbuyers away from the market ahead of holidays over the next twoweeks.

Crude has lost ground along with major equity markets asinvestors fret about the strength of the global economy headinginto next year. The prospect of a possible government shutdownin the United States, the world's biggest oil consumer, hasadded to investors' worries.

Oil markets have pulled back amid concerns about oversupply,despite planned production cuts by the Organization of thePetroleum Exporting Countries.

"OPEC folks are not doing a good job of convincing theinternational oil community that they are going to be a strongadvocate of their supply cut program," said Bob Yawger, directorof futures at Mizuho in New York.

The price declines were exacerbated by thin trade and riskaversion ahead of the Christmas and New Year holidays, traderssaid.

Brent crude LCOc1 fell 53 cents, or nearly 1 percent, tosettle at $53.82 a barrel, after falling during the session to$52.79 a barrel, the weakest since September 2017.

U.S. light crude oil CLc1 settled down 29 cents at $45.59a barrel, after earlier touching a session low of $45.13 abarrel.

Both contracts fell more than 11 percent in the week. Sincereaching multi-year highs at the beginning of October, bothcrude oil benchmarks have lost more than a third of their valuein their steepest decline for three years.

The big oil producers in OPEC, dominated by Middle East Gulfstates reliant on energy exports, have agreed to reduceproduction to try to push up prices.

But those output cuts - a reduction with Russia and othernon-OPEC producers of 1.2 million bpd - do not kick in untilnext month, and meanwhile global inventories are growing fast.

"The bear fest continues," said Stephen Brennock, analyst atLondon brokerage PVM Oil.

"According to OPEC's own forecasts, global oil stocks willbuild by 500,000 bpd in the first half of 2019. This willcompound a glut in OECD commercial oil stocks."

To show its commitment to reducing supply, OPEC will releasea table detailing output cut quotas for its members and alliessuch as Russia, OPEC Secretary General Mohammad Barkindo said ina letter reviewed by Reuters.

The proposed cut of 1.2 million bpd was an effectivereduction for member countries of 3.02 percent, Barkindo said.

That is higher than the initially discussed cut of 2.5percent as OPEC seeks to accommodate Iran, Libya and Venezuela,which are exempt from any requirement to cut.

Driving the sell-off has been sustained oversupply as theUnited States has emerged as the world's biggest crude producerthanks to the success of its shale industry.

The United States now pumps 11.6 million barrels per day(bpd) of crude, more than either Saudi Arabia or Russia.

U.S. energy companies added oil rigs for the first time inthe past three weeks, General Electric Co'sGE.N Baker Hughesenergy services firm said in its closely followed report onFriday.

Drillers added 10 oil rigs in the week to Dec. 21, bringingthe total count to 883. RIG-OL-USA-BHI . This was the biggestgain in rigs since early November. (Additional reporting by Christopher Johnson in London and MengMeng and Aizhu Chen in Beijing;Editing by Steve Orlofsky and Chizu Nomiyama) ((Jessica.Resnick-Ault@thomsonreuters.com; 646-223-6052;))


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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