Oil rebounds but ends week lower as OPEC cuts disappoint

Fri May 26, 2017 4:58pm EDT
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By Julia Simon

NEW YORK (Reuters) - Oil prices rebounded to rise more than 1 percent on Friday, but Brent crude ended the week nearly 3 percent lower after an OPEC-led decision to extend production curbs did not go as far as many investors had hoped.

Trading was light after Thursday's heavy sell-off and ahead of the long weekend break in the United States and Britain.

Brent futures LCOc1 settled up 69 cents to $52.15 a barrel, or 1.3 percent, after hitting a session low of $50.71.

U.S. West Texas Intermediate (WTI) crude futures CLc1 settled at $49.80 a barrel, gaining 90 cents or 1.8 percent, after hitting an intra-day low at $48.18.

On Thursday, the Organization of the Petroleum Exporting Countries and other producers pledged to continue output cuts of 1.8 million barrels per day (bpd) for another nine months, through the first quarter of 2018.

Crude prices plunged 5 percent after the decision as some had priced in more aggressive output cuts.

"I think it was kind of a knee jerk reaction, I don't think it was anything meaningful," said Antoine Halff, Director of the Global Oil Program at Columbia University.

CFTC data showed that in the week ahead of the OPEC meeting, hedge funds raised bullish bets on U.S. crude for the first time in five weeks. A majority of the increase came from gross short positions being liquidated.   Continued...

FILE PHOTO: A worker checks the valve of an oil pipe at the Lukoil owned Imilorskoye oil field near Kogalym, Russia, January 25, 2016.   REUTERS/Sergei Karpukhin/File Photo