By Sarah McFarlane and Jenny W. Hsu
Crude futures edged lower on Friday, with investors focused on the U.S., where production is growing faster than had been anticipated.
Brent crude, the global oil benchmark, fell 0.1% to $52.92 a barrel on London's ICE Futures exchange. On the New York Mercantile Exchange, West Texas Intermediate futures were trading down 0.1% at $50.65 a barrel.
Investors are also monitoring whether the Organization of the Petroleum Exporting Countries will extend ongoing production cuts into the second-half of 2017, a move which could offset rising U.S. output. Saudi Arabia Energy Minister Kalid al-Falih said Thursday that a handful of cartel members have reached a tentative agreement to cut more supplies.
Prices skidded midweek amid continued growth in U.S. output and a surprise increase in gasoline inventories there, but have since stabilized.
"With the oil market reeling from a midweek selloff triggered by an unexpected build in U.S. gasoline inventories, it was left to leading OPEC nations to restore a sense of calm and attempt to inject some much-needed bullish impetus," said Stephen Brennock at brokerage PVM.
However, some analysts say market reactions to comments from OPEC members are becoming more muted.
"The (lack of) reaction can either be attributed to saturation, as such news is released on almost a daily basis, or to the fact that the foremost goal of the OPEC agreement--namely to reduce the huge stocks of crude oil and oil products--is still a long way from being achieved," Commerzbank said in a note.
Global crude supplies remain above the five-year averages which OPEC has targeted bringing stocks down to.
Oil prices ticked higher initially after the comments from Saudi Arabia's energy minister, but quickly lost steam as analysts say the remark only stirred up more uncertainty.
"The length of the extension, the number of participating countries and the production to be sidelined remain key unknowns," said Vivek Dhar, a commodities strategist at Commonwealth Bank of Australia. If an extension is only for one quarter, such a move may be moot for the market's long-term health since it means non-U. S. producers will increase output anew, potentially sending stockpiles higher again.
Nymex reformulated gasoline blendstock--the benchmark gasoline contract--was unchanged at $1.67 a gallon. ICE gas oil changed hands at $475.50 a metric ton, down $1.25 from the previous settlement.
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(END) Dow Jones Newswires
April 21, 2017 05:59 ET (09:59 GMT)
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