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Crude oil futures - weekly outlook: July 17 - 21

Published 16/07/2017, 06:47 pm
© Reuters.  Oil logs a gain of roughly 5% for the week
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Investing.com - Oil prices settled higher for the fifth session in a row on Friday, to score a weekly gain of roughly 5% as investors cheered data suggesting that demand for oil will pick up during the second half of 2017.

The U.S. West Texas Intermediate crude August contract tacked on 46 cents, or around 1%, to end at $46.54 a barrel by close of trade Friday. It touched its highest since July 5 at $46.74 earlier.

Elsewhere, on the ICE Futures Exchange in London, Brent oil for September delivery rose 49 cents, or 1%, to settle at $48.91 a barrel by close of trade, after touching a more than one-week peak of $49.11 earlier in the session.

For the week, WTI gained $2.31, or about 5%, while Brent rose $2.20, or roughly 4.5%, aided by reports of accelerating demand growth from the International Energy Agency, crude oil import growth in China and falling crude stocks in the U.S.

Despite recent gains, concerns over rising global supplies remained on investors' minds.

U.S. drillers added two oil rigs in the week to July 14, energy services company Baker Hughes announced on Friday. This brings the total count up to 765, the most since April 2015, underlining concern that the ongoing rebound in U.S. shale production is derailing efforts by other major producers to rebalance the market.

In May, OPEC and some non-OPEC producers extended a deal to cut 1.8 million barrels per day in supply until March 2018.

So far, the production-cut agreement has had little impact on global inventory levels due to rising supply from producers not participating in the accord, such as Libya and Nigeria.

OPEC member Kuwait said on Friday it would be premature to cap Nigerian and Libyan oil production as the two African countries' output needed to stabilize further.

A ministerial committee from OPEC and non-OPEC countries, which is headed by Gulf OPEC member Kuwait, will meet in Russia on July 24 to discuss compliance with the cuts.

Elsewhere on Nymex, gasoline futures for August jumped 3.4 cents, or about 2.3%, to end at $1.560 on Friday, for a weekly gain of around 4.1%.

August heating oil finished up 2.3 cents, or 1.6%, at $1.515 a gallon, with an increase of almost 4.6% on the week.

Natural gas futures for August delivery ticked up 1.9 cents to settle at $2.980 per million British thermal units. It saw a weekly rise of roughly 4%.

In the week ahead, market participants will eye fresh weekly information on U.S. stockpiles of crude and refined products on Tuesday and Wednesday to gauge the strength of demand in the world’s largest oil consumer.

Meanwhile, traders will also continue to pay close attention to comments from global oil producers for evidence that they are complying with their agreement to reduce output this year.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Tuesday, July 18

The American Petroleum Institute, an industry group, is to publish its weekly report on U.S. oil supplies.

Wednesday, July 19

The U.S. Energy Information Administration is to release weekly data on oil and gasoline stockpiles.

Thursday, July 20

The U.S. government is set to produce a weekly report on natural gas supplies in storage.

Friday, July 21

Baker Hughes will release weekly data on the U.S. oil rig count.

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