Oil prices were mixed on Friday after recent declines, but were on track for the first weekly fall in six weeks, under pressure from surging U.S. supplies and doubts over Russian support for continuing a cut in crude output. Brent crude futures LCOc1, the international benchmark for oil prices, were at $61.23 per barrel at 0616 GMT, down 13 cents from their last close.
U.S. West Texas Intermediate (WTI) crude futures were at $55.32 a barrel, up 18 cents. Traders said strong U.S. crude exports were lifting WTI. Still, crude was on track to fall around 2-4 percent for the week on worries about growth in U.S. production and inventories, after both benchmarks touched 2015 highs last week.
“Russian support for a formalized extension of production cuts at the Nov. 30 OPEC meeting appears questionable, even if only to defer the decision to 1Q18,” U.S. investment bank Jefferies said.
“The production cut agreement between some OPEC and non-OPEC oil producers led to a drop in inventories and to a recovery of oil prices,” Dutch bank ABN Amro said.
“In the course of 2018 we expect a continuation of the oil price rally towards $75 per barrel,” ABN said.
The deal to restrain output is due to expire in March 2018, but OPEC will meet on Nov. 30 to discuss policy. Analysts said more production restraint is needed to reduce the supply overhang.
“The problem is still that oil stockpiles are above the five-year average,” said William O‘Loughlin, investment analyst at Australia’s Rivkin Securities.