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U.S. oil futures rebound from 3-month lows on falling rig count

Published 20/07/2015, 06:02 pm
© Reuters.  Nymex oil futures edge higher on falling rig count
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Investing.com - U.S. oil futures rose for the first time in four sessions on Monday, as investors returned to market to seek bargains after prices fell to the lowest level in more than three months.

On the New York Mercantile Exchange, crude oil for September delivery rose 30 cents, or 0.6%, to trade at $51.52 a barrel during European morning hours.

On Friday, Nymex oil futures hit $50.50, a level not seen since April 10, before ending at $51.21, down 3 cents, or 0.06%.

New York-traded oil futures slumped $1.26, or 3.51%, last week, the fifth consecutive weekly loss, as worries over high domestic U.S. oil production weighed.

According to industry research group Baker Hughes (NYSE:BHI), the number of rigs drilling for oil in the U.S. declined by seven last week to 638, snapping two weeks of gains. The data eased concerns over a revival in U.S. drilling activity.

Elsewhere, on the ICE Futures Exchange in London, Brent oil for September delivery tacked on 26 cents, or 0.46%, to trade at $57.36 a barrel.

London-traded Brent futures lost $1.49, or 3.22%, last week, the third straight weekly decline, amid concerns a resumption of Iranian oil exports will add to a global glut.

Iran and six world powers reached a long-awaited nuclear deal last week that would end sanctions on Tehran in exchange for curbs on the country's disputed nuclear program.

Iran reportedly hoards 30 million barrels of oil in its reserves ready for export. However, analysts largely estimate that Iranian crude exports could take several months to ramp up significantly.

Global oil production is outpacing demand following a boom in U.S. shale oil production and after a decision by the Organization of Petroleum Exporting Countries last year not to cut production.

The spread between the Brent and the WTI crude contracts stood at $5.84 a barrel, compared to $5.89 by close of trade on Friday.

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