Oil Prices Cling to Gains as US Rig Count Jumps for 15th Week in a Row

1:18 PM, Apr 28, 2017 — Oil futures prices were holding onto early gains on Friday afternoon despite fresh data revealing a 15th consecutive week in which the number of US oil rigs in operation has risen against a backdrop of a weakening greenback.

West Texas Intermediate (WTI) crude oil futures, the main US benchmark, were 0.4% higher at $49.17 per barrel while Brent oil futures, the international gauge, were up by 0.3% at $51.99 per barrel at the time of writing. WTI is currently on track to finish the week down by 0.9% while Brent crude is heading toward a weekly gain of 0.1%.

The total number of US oil and gas rigs in operation stood at 870 in the week ended April 28, according to data published by oilfield services company Baker Hughes on Friday. This was 13 rigs more than in the previous week and 450 more than one year ago. The last time that the US rig count posted a weekly decline was in the week ended January 13, when the number of rigs in operation declined by six.

In Canada, the number of rigs in operation contracted by 14 to 85, although it was up by 48 from one year ago. The international rig count for the month of March, the most recent data, was up by by 2 at 943 and down by 42 from one year ago.

Also feeding into oil trading sentiment was a softening in the value of the greenback and a surprise contraction in the US inventories of oil. As a dollar-denominated commodity, a cheaper US currency makes oil more affordable to buyers outside the US. The Dollar Index, which tracks the value of the US currency against a basket of foreign currencies, was 0.14% lower at the time of writing.

Data published by the Energy Information Administration (EIA) on Wednesday showed that US inventories of oil declined by 3.6 million barrels to 528.7 million barrels in the week ended April 21. This compared to a 1 million barrel weekly decline registered the previous week and an 897,000 barrel increase which had been projected by the American Petroleum Institute (API) on Tuesday.

Price: 7.60 Price Change: +0.12 Percent Change: +1.60

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