Oil prices retreat from $50 on oversupply concerns

By Keith Wallis
SINGAPORE, May 27 (Reuters) - Oil futures dipped further in
early Asian trade on Friday, finding resistance at the $50 a
barrel mark as investors worried higher prices could reactivate
shuttered crude output, adding to global oversupply.
Oil pushed through $50 for the first time in around seven
months on Thursday as supply disruptions from Canadian wildfires
and attacks in Libya and West Africa have helped cut daily
output by 4 million barrels. Increased demand and a weaker
dollar helped support prices.
U.S. crude CLc1 fell 7 cents to $49.41 a barrel as of 0033
GMT after settling down 8 cents in the previous session. It
touched $50.21 earlier on Thursday, its highest since early
October.
Brent LCOc1 fell 9 cents to $49.50. Brent closed down 15
cents, retreating from $50.51, its highest since early November.
"WTI and Brent futures went through $50 a barrel on
tightening supply, but unsurprisingly hit stubborn resistance at
that key level and then eased back," ANZ said in a note on
Friday.
Oil prices, which have risen nearly 90 percent from 12-year
lows hit earlier this year, face pricing barriers to moving
higher in the next three to five weeks, technical analysts said
on Thursday, with Brent facing a significant hurdle at around
$52 a barrel.
Donald Trump, the presumptive Republican presidential
nominee, promised to revive the ailing U.S. oil and coal
industries on Thursday, by scrapping key environmental policies
including a U.S. withdrawal from the U.N. global climate accord.

Nigeria's government needs to address grievances in the
oil-producing Niger Delta, Oil Minister Emmanuel Ibe Kachikwu
said on Thursday, hours after a Chevron (NYSE:CVX) source CVX.N said a
militant attack had forced it to shut its onshore operations in
the restive region.
Investors were also awaiting the appearence of U.S. Federal
Reserve Chair Janet Yellen at an event later on Friday for
further indications on when the Fed could raise interest rates.
A raft of Fed officials have called for a normalisation of
interest rates as the U.S. economy and inflation rise, with odds
of a June hike now sitting around 34 percent, compared with 4
percent last week, ANZ analysts said.
"Markets have moved a lot recently and whilst activity data
has improved and interest rate expectations have risen, more
news is now needed to help shape the markets' expectations over
a possible June/July Fed rate hike," the ANZ note on Friday
said.