Tokyo: Oil held gains near $69 a barrel as drill rig data signalled slowing growth in American crude production and as the US and Mexican governments near a breakthrough on a trade standoff.
Oil holds gains as US rigs decline at fastest pace since 2016
Futures in New York were little changed after a 1.3% gain Friday. Working oil rigs in the US fell by nine to 860 last week, the biggest drop since May 2016, according to Baker Hughes data released on Friday. Meanwhile, the US and Mexico are poised to resolve their bilateral Nafta differences as soon as Monday after breakthroughs on issues including automobiles and energy.
Oil has traded below $70 as a trade war between the US and China, coupled with the threat of contagion from the Turkish currency crisis, has weighed on prices. Still, slowing US output growth and pipeline bottlenecks are adding to supply risks as the Trump administration is set to impose sanctions on crude exports from Iran in early November.
West Texas Intermediate crude for October delivery traded at $68.64 a barrel on the New York Mercantile Exchange, down 8 cents, at 8:46 a.m. in Tokyo. The contract rose 89 cents to $68.72 on Friday. Total volume traded was about 72% below the 100-day average. Brent for October settlement traded at $75.62 on the London-based ICE Futures Europe exchange, down 20 cents. Prices on Friday added 1.5% to $75.82. The global benchmark crude traded at $6.99 premium to WTI.