Oil Gains Near $52 as Dollar Slips, U.S. Drillers Cut Rigs
NEW YORK (Bloomberg) - Oil rose to near $52 a barrel as the dollar fell and U.S. drillers cut rigs to the lowest in eight weeks.
Futures in New York gained as much as 1.3 percent. The number of oil rigs in America fell to by four to 873 last week and the U.S currency slipped Monday.
Hedge funds slashed bullish bets on U.S. crude to the lowest in more than two years, showing they aren’t buying into OPEC and its allies’ production cuts just yet.
"The dollar’s weakness is pushing up oil today,” said Giovanni Staunovo, a commodities analyst at UBS Group AG. "The oil market will tighten beyond current bearish expectations over the coming months as Iranian and Venezuelan output is likely to fall further.”
West Texas Intermediate for January delivery was at $51.35 a barrel on the New York Mercantile Exchange, up 15 cents, at 8:28 a.m. local time.
The contract fell $1.38 on Friday. Total volume traded Monday was about 14 percent below the 100-day average.
Brent for February settlement added 34 cents to $60.62 a barrel on London’s ICE Futures Europe exchange, after dropping $1.17 on Friday. The global benchmark crude traded at an $8.98 premium to WTI for the same month.
The Bloomberg Dollar Index, which tracks a basket of 10 leading global currencies against the U.S. currency, fell as much as 0.3 percent after gaining 0.7 percent last week. A weaker greenback makes dollar-priced commodities more attractive.
U.S. drillers will produce an average 12.06 million barrels a day next year, up from 10.88 million in 2018, the Energy Information Administration said last week. Weekly crude output remains near a record high.
Futures in New York gained as much as 1.3 percent. The number of oil rigs in America fell to by four to 873 last week and the U.S currency slipped Monday.
Hedge funds slashed bullish bets on U.S. crude to the lowest in more than two years, showing they aren’t buying into OPEC and its allies’ production cuts just yet.
"The dollar’s weakness is pushing up oil today,” said Giovanni Staunovo, a commodities analyst at UBS Group AG. "The oil market will tighten beyond current bearish expectations over the coming months as Iranian and Venezuelan output is likely to fall further.”
West Texas Intermediate for January delivery was at $51.35 a barrel on the New York Mercantile Exchange, up 15 cents, at 8:28 a.m. local time.
The contract fell $1.38 on Friday. Total volume traded Monday was about 14 percent below the 100-day average.
Brent for February settlement added 34 cents to $60.62 a barrel on London’s ICE Futures Europe exchange, after dropping $1.17 on Friday. The global benchmark crude traded at an $8.98 premium to WTI for the same month.
The Bloomberg Dollar Index, which tracks a basket of 10 leading global currencies against the U.S. currency, fell as much as 0.3 percent after gaining 0.7 percent last week. A weaker greenback makes dollar-priced commodities more attractive.
U.S. drillers will produce an average 12.06 million barrels a day next year, up from 10.88 million in 2018, the Energy Information Administration said last week. Weekly crude output remains near a record high.