Oil prices jumped on Friday, with Brent crude futures hitting their highest in more than two weeks as US stock prices rose and investors covered short bets ahead of a weekend in which the US news program 60 Minutes will air an interview with Saudi Arabia’s crown prince.
Saudi Crown Prince Mohammed bin Salman was on 60 Minutes on Sunday ‘comparing Iran’s Ayatollah to Hitler, and the battle in Ghouta, Syria, is ramping up,’ said John Kilduff, partner at investment manager Again Capital in New York. ‘You can’t be short oil over the weekend with all that going on in the region.’
Brent futures rose $US1.09 to settle at $US66.21 a barrel, a 1.7 per cent gain. During the session, Brent hit $US66.42, its highest since February 28.
US West Texas Intermediate (WTI) crude futures for April, which will expire on Tuesday, rose $US1.15 to settle at $US62.34 a barrel, a 1.9 per cent gain. WTI hit a high of $US62.54, its highest since March 7.
Brent futures gained one per cent for the week, while WTI marked a weekly rise of 0.4 per cent. It was the second straight weekly rise for both contracts.
Gains on Wall Street also supported crude futures, which have recently been moving in tandem with US stock indices.
Hedge funds and other money managers cut their bullish bets on US crude oil futures and options in the week to March 13, as crude prices fell for a second week, the US Commodity Futures Trading Commission (CFTC) said.
The speculator group cut its combined futures and options position in New York and London by 24,667 contracts to 453,864 during the period. The cuts marked the second consecutive week in which speculators cut their net long positions in the market.
US drillers added four oil rigs this week, bringing the total count to 800, General Electric Co’s Baker Hughes energy services firm said. It was the seventh US rig count rise in eight weeks.
On Thursday the International Energy Agency (IEA) predicted global oil demand would pick up this year, but supply is growing at a faster pace, which should boost inventories.
The agency raised its forecast for oil demand this year to 99.3 million barrels per day (bpd) from 97.8 million bpd in 2017, and said it expected supply from non-OPEC nations to grow by 1.8 million bpd in 2018 to 59.9 million bpd, led by the United States.
OPEC and other producers have cut output to reduce a global crude glut.
On Wednesday, the US government reported that crude stockpiles in the United States increased by a more-than-expected 5 million barrels.