Oil Higher on Monday As US Rig Count Continues to Rise

Oil edged up for a third straight session on Monday, climbing off last week’s seven-month lows but with gains capped by the relentless rise in U.S. supply and bloated global inventories.

Investors in U.S. crude futures and options increased their bets against a further rise in prices, as the number of U.S. oil rigs in operation hit its highest in over three years. [CFTC/] [RIG/U]

U.S. shale oil output is up around 10 percent since last year, while places like Brazil have also hiked output.

The rise in supplies threatens to scupper efforts by the Organization of the Petroleum Exporting Countries and its partners to reduce global oil inventories with production cuts.

Brent crude futures were up 11 cents at $46.65 per barrel by 1133 GMT, on track for a near 20 percent drop in the first half of the year. It hit a trough of $44.35 on June 21, its lowest level since November.

U.S. West Texas Intermediate crude futures were up 17 cents at $43.18 per barrel.

“We saw this continued big rise in oil rigs last week and in our view we don’t need a single additional rig for the next 12 months in the U.S. space if we look at balance for 2018,” SEB strategist Bjarne Schieldrop said.

via Reuters

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.