Oil rises in late trade, still down on the week as glut weighs

Fri Mar 24, 2017 3:35pm EDT
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By David Gaffen

NEW YORK (Reuters) - Oil rose modestly on Friday in a spate of late-day activity, but fell on the week as concerns persisted over an excess of crude.

U.S. West Texas Intermediate (WTI) crude futures CLc1 settled up 27 cents to $47.97 a barrel, but lost 0.5 percent on the week. About 390,000 WTI contracts had changed hands, lower than the average of about 520,000 over the last 200 days.

Brent crude LCOc1 ended up 24 cents to $50.80, and ended down 1.8 percent this week.

Oil has been on the back foot for more than two weeks now, after a string of U.S. inventory reports suggested that output cuts by the Organization of the Petroleum Exporting Countries were not having the desired effect in reducing global oversupply.

On Thursday, a Saudi energy ministry official told Reuters that crude exports to the United States in March would fall by around 300,000 barrels per day (bpd) from February and hold at those levels for the next few months.

The official said the expected drop, in line with OPEC's agreement, could help draw down U.S. inventories that stood at a record 533 million barrels last week - stocks that have in part remained buoyant because of reduced seasonal refining runs.

"We still are at record high inventories here in the U.S.," said Andrew Lipow, president of Lipow Oil Associates in Houston. "We're seeing some short-covering given the recent declines in the price."

Saudi exports to other regions, notably Asia, remained elevated despite the OPEC-led deal that includes other producers like Russia to cut output by 1.8 million bpd during the first half of the year.   Continued...

A fisherman pulls in his net as an oil tanker is seen at the port in the northwestern city of Duba April 20, 2013. Picture taken April 20. REUTERS/Mohamed Al Hwaity