* U.S. oil rigs rise 2nd week in row, up by 3
* Dollar rises most in 2 months, hurting
greenback-denominated oil
* Wall Street slide further fuels pre-weekend profit-taking
in oil
(New throughout, updating market activity and comments to
settlement)
By Barani Krishnan
NEW YORK, June 10 (Reuters) - Oil prices settled down 3
percent on Friday after data showing the U.S. oil drilling rig
count rising for a second week in row and a stronger dollar
weighed on demand for greenback-denominated crude futures.
A slide of more than 1 percent in Wall Street share prices
.SPX , the largest since April, also prompted pre-weekend
profit-taking in Brent and U.S. crude futures, which had rallied
earlier in the week. .N
The dollar .DXY jumped its most in nearly two months,
rising 0.7 percent, as jittery global financial markets sent
investors towards safe haven currencies. USD/
Brent's front-month LCOc1 settled down $1.41 at $50.54 a
barrel, losing 2.7 percent for its largest drop in a month.
The front-month in U.S. crude's West Texas Intermediate
(WTI) futures CLc1 fell $1.49 to $49.07, down 3 percent,
marking the largest slide since early April.
Still for the week, Brent rose nearly 2 percent and WTI
about 1 percent, helped by gains in the first three sessions
that boosted the North Sea benchmark to an eight-month peak and
the U.S. benchmark to July highs.
Crude futures are also about 90 percent higher from 13-year
lows hit during the winter, lifted by supply disruptions from
Nigeria, Canada, Libya and Venezuela that combined with lower
U.S. production. Worries about a global crude glut drove prices
down from above $100 a barrel to below $30 between mid-2014 and
the first quarter of 2016.
U.S. oil drillers added three oil rigs in the week to June
10, after a nine-rig rise in the previous week, oil services
firm Baker Hughes said in its weekly survey of the rig count.
RIG/U
"This looks like the beginning of a trend that will
translate to the slowing down of U.S. crude production
declines," said Tariq Zahir, who trades WTI futures spreads for
Tyche Capital Advisors in New York. "I'm adding to my short
positions in spreads."
But some market sources said unless the rig count climbed
exponentially in the coming weeks, the market was likely to
shrug off the data.
Before this week, oil rigs fell on average by 10 per week
this year. Last year, they slumped by an average of 18 a week as
low crude prices made it uneconomical to drill.
"The 10-15 rig rise we've had so far won't change anything
significantly on supply. At this point, it's hard to get to
excited about an uptick in production coming this year," said
Scott Shelton, energy broker with ICAP (LON:IAP) in Durham, North
Carolina.
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Global refining capacity to hit new record http://tmsnrt.rs/1PND18i
COLUMN-Oil market is back in balance: Kemp
Unplanned supply disruptions http://www.eia.gov/todayinenergy/detail.cfm?id=26592
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