Oil prices continued to increase during the week ending Jan.18, with the price of West Texas Intermediate (WTI) for February delivery up by 4.3 percent and Brent crude for March delivery up by 3.7 percent, Trend reports citing Xinhua.
In the previous week ending Jan. 11, oil prices continued to extend increases. WTI for February delivery up by 7.6 percent, and Brent crude for March delivery up by 6.0 percent. At the end of the week, WTI settled at 51.59 US dollars a barrel, while Brent crude closed at 60.48 dollars a barrel.
On Monday, oil prices declined as investors renewed concerns for a global growth slowdown. Analysts said oil prices were weighted down by the expectations of weaker economic growth, which would lead to weaker crude oil demand.
WTI for February delivery fell 1.08 dollars to settle at 50.51 dollars a barrel, while Brent crude for March delivery erased 1.49 dollars to close at 58.99 dollars a barrel.
On Tuesday, oil prices rose as market sentiment was lifted by news that China might roll out further fiscal stimulus measures. WTI for February delivery rose 1.6 dollars to settle at 52.11 dollars a barrel, while Brent crude for March delivery increased 1.39 dollars to close at 60.38 dollars a barrel.
Meanwhile, oversupply worries have eased as the Organization of the Petroleum Exporting Countries (OPEC) and other major crude exporters, including Russia, agreed last year to cut supply starting this month to curb a global glut.
On Wednesday, oil prices rose slightly as moderate US crude oil draw eased concerns over a global over-supply. WTI for February delivery rose 0.2 dollar to settle at 52.31 dollars a barrel, while Brent crude for March delivery increased 0.68 dollar to close at 61.32 dollars a barrel.
US commercial crude oil inventories fell 2.7 million barrels for the week ending Jan, 11, said the Energy Information Administration on Wednesday. However, at 437.1 million barrels, US crude oil inventories are about 8 percent above the five-year average for this time of year.
The administration added that US crude production rose to 11.9 million barrels per day for the same period, up by 200,000 barrels per day from the previous week.
In its latest Short-Term Energy Outlook, the EIA forecasts US crude oil production to average 12.1 million barrels per day in 2019 and 12.9 million barrels per day in 2020, with most of the growth coming from the Permian region of the state of Texas and New Mexico.
On Thursday, oil prices declined as investors continued to worry about a global glut, which is fueled by rising US crude output. WTI for February delivery declined 0.24 dollar to settle at 52.07 dollars a barrel, while Brent crude for March delivery decreased 0.14 dollar to close at 61.18 dollars a barrel.
On Friday, oil prices surged as falling US rig count eased some of the concerns over a global glut. WTI for February delivery added 1.73 US dollars to settle at 53.80 dollars a barrel, while Brent crude for March delivery increased 1.52 dollars to close at 62.70 dollars a barrel.
The US rig count was down 25 rigs in the week ending Jan. 18 from the previous week to 1,050 rigs, or 114 more than that this time last year, according to data released by oilfield services company Baker Hughes on Friday.
"The market doesn't panic a lot about the decrease because a number of factors, such as the cold weather, the delay of drilling projects, could contribute to the fall," an oil and gas market researcher from the University of Texas at Austin said.
"What matters is the trend that we have a larger amount of active drilling rigs than last year. This shows that the industry is optimistic about future," he added.
Oil prices are up about 4 percent this week, posting a third consecutive week of gains following a three-month collapse.
Although the OPEC-led cuts reduce supplies, some traders and investors are still concerned that growth in global supply this year will outpace demand, causing the drop in oil prices.
In the meantime, the market will watch the global financial market, as economic slowdown looms worldwide.