Oil prices fell on Friday after a three-day rally ran out of steam, promising to notch up the oil market's worst-performing quarter since 2015 as
Oil prices fell on Friday after a three-day rally ran out of steam, promising to notch up the oil market’s worst-performing quarter since 2015 as investors fret that growing U.S. supplies are undermining OPEC-led cuts.
Brent crude futures LCOc1 have made the biggest losses across global asset classes this quarter and in March the contracts made the biggest monthly losses since July as growing U.S. crude inventories and drilling activity counter-balance production cuts elsewhere in the world.
On Friday, Brent futures were down 32 cents at $52.64 a barrel at 0836 GMT. The contracts have lost around 7 percent since the previous quarter, the worst quarterly losses since late 2015.
U.S. crude futures CLc1 were down 20 cents, at $50.15 a barrel. They are on track to end the quarter 6.5 percent lower, also the worst quarterly losses since late 2015.
“I wouldn’t be surprised to see some profit-taking ahead of the weekend after the strong gains in recent days,” said Carsten Fritsch, commodity analyst at Commerzbank.
“The expected rise in the U.S. rig count later today provides some arguments to sell at last.”
Later on Friday, energy services firm Baker Hughes will publish weekly U.S. oil rig figures. The indicator has shown huge gains, with the rig count doubling in a ten-month recovery and undermining efforts led by the Organization of the Petroleum Exporting Countries to rein in output.
Oil prices had gained momentum earlier this week on the back of growing sense that OPEC and non-OPEC oil production giant Russia would agree to continue their production cut deal seeking to drive prices higher.
OPEC and non-OPEC producers including Russia agreed late last year to cut output by almost 1.8 million barrels per day (bpd) during the first half of the year in order to rein in a global supply overhang and prop up prices.
“The changed thoughts about Russia’s role in the market reinforce…(the idea) that a deal between OPEC and Russia is in the offing,” said Greg McKenna of futures brokerage AxiTrader.
reuters.com
