Both WTI and brent closed on Friday under $ 34, remaining near 12-year lows Investing.com — Crude futures fell slightly on Friday in a quiet end to a tumultuous week that saw global oil prices hit a 12-year low, amid widespread concerns in China and the Middle East.
On the New York Mercantile Exchange, WTI crude for February delivery traded in a broad range between $ 32.66 and $ 34.26 a barrel, before settling at $ 33.16, down 0.10 or 0.29% on the session. After posting its fifth consecutive losing session, futures closed the opening week of the year down by more than 10%. More broadly, the front month contract for WTI crude has fallen by more than $ 6 a barrel since at a closely-watched meeting last month in Vienna.
On the Intercontinental Exchange (ICE), brent crude for February delivery wavered between $ 32.80 and $ 34.70 a barrel, before closing at $ 33.56, down 0.19 or 0.56% on the session. Both the international and U.S. domestic benchmarks of crude plummeted to their lowest level since 2004 on Thursday, as investors continued to digest the growing discord between Saudi Arabia and Iran, two of the world’s top oil producers.
Meanwhile, brent traded at a premium of 0.40 over WTI at Friday’s close, slightly below the spread of 0.49 at the end of trading one day earlier.
In China, the closed on Friday after the Chinese central bank soothed markets by setting a higher daily fix in comparison with the previous session. The rally halted a , after weak manufacturing and service sector data led to mounting concerns of slowing economic growth in the world’s second-largest economy. On Thursday, trading was halted within a half-hour after a circuit breaker was triggered for the second time this week when the Index plunged 7%.
The massive sell-off in China has exacerbated fears of weakening demand in the world’s second-largest consumer of oil. At 10.5 million barrels per day, China consumes more oil than any other nation in the world besides the U.S.
Investors also reacted to a from oil services firm Baker Hughes, which said on Friday that U.S. oil rigs last week fell by 20 to 516 for the week ending on 516. It marked the third consecutive week of weekly draws and the seventh time in eight weeks that the rig count has moved lower. The rig total is down sharply from its level in November, 2014, when it hovered around 1,600.
A major reduction the rig count typically provides an indication that U.S. crude production is about to decline in the coming weeks. However, U.S. shale producers have displayed resiliency in recent months by drilling at high levels while taking ineffective rigs offline. Last week, U.S. crude production eclipsed 9.2 million barrels per day for the first time since August.
Crude prices worldwide have crashed more than 50% over the last 14 months since OPEC triggered a prolonged battle with shale producers for market share, following its strategic decision to maintain its production ceiling above 30 million barrels per day. The tactic flooded global markets with a glut of excessive crude, as supply continues to outpace demand.
The , which measures the strength of the greenback versus a basket of six other major currencies, gained more than 0.50% to an intraday high of 99.27. With several hours left in Friday’s session, the index was on pace to finish flat for the week.
Dollar-denominated commodities such as gold become more expensive for foreign purchasers when the dollar appreciates.
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Crude falls barely, ending tumultuous week close to 12-year lows
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