Oil futures ended Friday’s session close to two-month lows as concerns over the global economic outlook combined with data showing that the U.S. oil rig count rose for the fifth time over the past six weeks weighed.
On the ICE Futures Exchange in London, Brent oil for September delivery fell to an intraday low of $46.15 a barrel, a level not seen since May 11, before recovering to settle at $46.76 by close of trade, up 36 cents, or 0.78%.
Despite Friday’s gains, London-traded Brent futures dropped $3.84, or 7.13%, on the week, its worst weekly performance since mid-January, amid growing anxiety over the economic impact of Britain’s vote to leave the European Union.
The news sparked concerns that Europe will fall back into recession, putting more pressure on the global economy and undermining future oil demand prospects.
Elsewhere, on the New York Mercantile Exchange, crude oil for delivery in August advanced 27 cents, or 0.6%, to end at $45.41 a barrel, after slumping to $44.77 earlier in the session, the lowest since May 11.
For the week, New York-traded oil futures sank $3.70, or 7.31%, its biggest weekly loss in almost six months, amid signs of an ongoing recovery in U.S. drilling activity.
Oilfield services provider Baker Hughes said late Friday that the number of rigs drilling for oil in the U.S. increased by 10 last week to 351, marking the fifth increase in six weeks.
The renewed gain in U.S. drilling activity fueled speculation that domestic production could be on the verge of rebounding in the weeks ahead, underlining worries over a supply glut.
According to the U.S. Energy Information Administration, crude oil inventories declined by a less-than-expected 2.2 million barrels last week to 524.4 million, which the EIA considered to be “historically high levels for this time of year”.
In the week ahead, oil traders will be focusing on U.S. stockpile data on Tuesday and Wednesday for fresh supply-and-demand signals.
Meanwhile, investors will keep an eye out for monthly reports from the Organization of Petroleum Exporting Counties and the International Energy Agency to gauge global supply and demand levels.
Market players will also continue to monitor supply disruptions across the world for further indications on the rebalancing of the market.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Tuesday, July 12
The Organization of Petroleum Exporting Counties will publish its monthly assessment of oil markets.
The American Petroleum Institute, an industry group, is to publish its weekly report on U.S. oil supplies.
Wednesday, July 13
The International Energy Agency will release its monthly report on global oil supply and demand.
The U.S. Energy Information Administration is to release its weekly report on oil and gasoline stockpiles.
Friday, July 15
Baker Hughes will release weekly data on the U.S. oil rig count.