Oil up after Wall Street rally, drop in U.S. rigs

Fri Sep 25, 2015 3:10pm EDT
 
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By Barani Krishnan

NEW YORK (Reuters) - Oil prices rose for the second straight day on Friday, supported by a rally on Wall Street and a lower U.S. rig count, although the decline in drilling was the smallest in four weeks and not particularly exciting to traders.

Crude futures posted stronger gains for the week. Optimism in recent days about lower stockpiles at the Cushing, Oklahoma, delivery point for U.S. crude overshadowed data on inventory builds in U.S. gasoline.

Still, some traders and analysts expressed doubt that oil would continue trading higher in the coming weeks due to mixed outlooks for supply and demand and for the global economy.

"I'm predicting a return to the low $40 levels or even below by next month," said Tariq Zahir, a trader in crude oil spreads at Tyche Advisors in Laurel Hollow, New York.

"As U.S. refinery maintenance kicks into full gear, we're going to start seeing inventory builds instead of draws," Zahir said.

Brent, the global benchmark for oil, settled up 43 cents, or 0.9 percent, at $48.60 a barrel. It rose almost $1 at the session high, riding the coattails of the U.S. equities rally, then turned negative for a good part of the day before rebounding. [.N]

U.S. crude settled up 79 cents, or 1.8 percent, at $45.70.

For the week, both Brent and U.S. crude were up about 2 percent.   Continued...

 
A pump jack is seen at sunrise near Bakersfield, California October 14, 2014. REUTERS/Lucy Nicholson