By Barani Krishnan
Investing.com - The U.S. oil rig count jumped by 11 this week, the first major increase in months, and from record lows of last week. The surge suggests crude drillers in the world’s largest producing country were beginning to add to output amid steady prices at around $40 per barrel despite a questionable demand outlook for fuel amid the coronavirus pandemic.
Rigs actively drilling for oil stood at 183 this week, versus last week’s all-time low of 172, oil services firm Baker Hughes said in its weekly survey. Baker Hughes has not reported rig additions since January and certainly not near a dozen rigs for months now.
New York-traded West Texas Intermediate, the benchmark for U.S. crude futures, was down 84 cents, or 2%, at 41.98 per barrel.
London-traded Brent, the bellwether for global crude prices, fell 85 cents, or 1.9%, to $44.05.
Even before the Baker Hughes data release, crude prices were trading down Friday on reports of a ceasefire in oil-rich Libya — a development that looked set to increase global production and ruin OPEC’s 97% compliance rate on an agreement to cut oil production.
OPEC, or the Organization of the Petroleum Exporting Countries, has 13 members led by Saudi Arabia. It also has 10 non-members allies that include Russia. It announced this week that demand for oil could be slower than expected, despite production cuts by its enlarged OPEC+ group.