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Oil prices down on profit-taking after two-day jump

Published 30/09/2016, 10:44 am
© Reuters.  Oil prices down on profit-taking after two-day jump
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TOKYO, Sept 30 (Reuters) - Oil prices dropped on Friday on profit-taking, after rising 7 percent in the past two sessions, amid doubts that OPEC's first planned output cut in eight years would make a substantial dent in the global crude glut.

London Brent crude for November delivery LCOc1 , which expires after the settlement later in the day, was down 8 cents at $49.16 a barrel by 0023 GMT. It settled up 55 cents, or 1.1 percent, on Thursday, adding to a 5.9 percent gain in the previous session.

NYMEX crude for November delivery CLc1 was down 8 cents at $47.75. It settled up 78 cents on Thursday, after touching a one-month high of $48.32 earlier.

Both Brent and NYMEX crude are on course for a weekly gain of around 7 percent.

The Organization of the Petroleum Exporting Countries (OPEC) agreed on Wednesday to cut output to 32.5-33.0 million barrels per day (bpd) from around 33.5 million bpd, estimated by Reuters to be the output level in August. said other details will be known at its policy meeting in November, leaving unanswered when the agreement will come into effect, what new quotas for member countries will be and for what periods, and how compliance will be verified.

OPEC officials said their plan will remove around 700,000 bpd from the market. Analysts estimate the global crude oversupply at between 1.0-1.5 million bpd.

Analysts at Goldman Sachs (NYSE:GS) said higher crude prices will spur non-OPEC output, particularly U.S. shale oil. The U.S. oil drilling rig count has risen in 12 of the 13 past weeks. RIG/U

The market awaited weekly data on U.S. oil rig count issued by energy services firm Baker Hughes Inc due out later in the day.

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