Crude oil futures gained in mid-morning European trading Friday on mixed cues, with ICE Brent re-testing the $80/b mark on lingering geopolitical concerns but further gains capped by soaring US inventory stocks this week.
At 1045 GMT, the December ICE Brent crude futures contract was $80.06/b, up 77 cents from Thursday’s settle at. The NYMEX November light sweet crude contract, meanwhile, was up 45 cents at $69.10/b and pricing in a contango at the front end of the forward curve with the December contract up 48 cents at $69.19/b.
“There is a bit of confusion as to where the market is really heading, inventory numbers have given one direction but the market has done something else,” said Frank Lausen of Global Risk Management, adding that despite the recent fall in oil prices “$80/b is a big support level that is likely to hold up this week.”
Offsetting the gains seen in US crude oil inventories this week has been lingering concerns over tighter supply due to falling oil exports from Iran and declining production in Venezuela.
Compounding those concerns has been the possibility of retaliatory measures by the US against Saudi Arabia over the disappearance and alleged murder of Saudi dissident Jamal Khashoggi.
Meanwhile, combined oil and gas rig counts in the US fell by 10 to a five-week low of 1,161 amid further declines in the Permian Basin, S&P Global Platts reported.
Market participants will keep a look out on the Baker Hughes rig count data — an early indicator of future US crude production — which will be published later Friday. Plats.com
