* U.S. drillers add 9 oil rigs in week to June 3 - Baker
Hughes
* Weak jobs data raises concerns about economy - traders
* OPEC meeting in Vienna does not agree output targets
* Saudi restraint seen as market supportive
(Updates to settlement)
By Devika Krishna Kumar
NEW YORK, June 3 (Reuters) - Oil prices tumbled more than 1
percent on Friday, extending losses after weekly industry data
showed U.S. drillers added rigs for only the second time this
year.
Drillers added nine oil rigs in the week to June 3, Baker
Hughes said. The closely followed report rekindled fears that
U.S. shale drillers would turn the spigots back on as prices
flirted with $50 a barrel. RIG-OL-USA-BHI
Prices had already dipped in early trade on worries about
the U.S. economy, but losses were limited by a weakening dollar,
which makes oil less expensive for buyers using other
currencies.
"The increase in the rig count as prices near the $50/bbl
range is clearly indicative of the elasticity of U.S. production
and speaks to the tremendous efficiency gains reaped by the U.S.
producer community over recent years," said Michael Tran,
director of energy strategy at RBC Capital Markets in New York.
Oil traders view falling U.S. output as key to reducing a
global glut of crude that has pressured prices during a steep
two-year slump.
Brent crude futures LCOc1 ended the session down 40 cents
at $49.64 per barrel. Brent's price remained almost double
January lows, notching its eighth weekly gain in nine weeks.
U.S. West Texas Intermediate (WTI) crude futures CLc1
settled down 55 cents at $48.62. For the week, prices fell 1.1
percent, its first weekly decline in four weeks.
Oil prices have rallied from the winter's lows due largely
to supply disruptions, particularly in Nigeria, Venezuela, Libya
and Canada. On Friday, militants in the restive Niger Delta
region that produces more than half of Nigeria's oil claimed
three new attacks on oil infrastructure, promising to bring the
country's oil production to "zero."
Still, news that ExxonMobil lifted its force majeure, or
suspension of deliveries on exports of Nigeria's Qua Iboe crude
oil because of events beyond its control, looked likely to bring
barrels back to the market.
"If you're starting to see some of those barrels coming
back, well, that's happening ahead of schedule, in my opinion,"
Bob Yawger, director of the futures division at Mizuho in New
York.
The tone of the Organization of the Petroleum Exporting
Countries (OPEC) meeting in Vienna on Thursday supported prices
"from the perspective that none of the major players (except
Iran) indicated that they would be further flooding the market
with oil anytime soon," said Energy Management Institute analyst
Dominick Chirichella.
Weaker-than-expected U.S. non-farm payroll data supported
oil by sending the dollar index .DXY to its lowest since
mid-May.
However, the weak data also pressured oil prices by raising
concerns about U.S. gasoline demand this summer, Yawger said.
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