Both US and UK crude oil futures’ prices secured marginal gains this week as oil contracts tumbled for a second straight session on Friday, pulling back from a 13-month-peak hit earlier this week as a pre-weekend profit-taking wave from the investors alongside a temporary supply glut stemming off a historic winter storm in the US State of Texas that shuttered down a fifth of the nation’s oil refiners, had jolted market participants’ optimism over the high-flying black gold contracts.
Apart from that, a spike in tensions in the Mideast following OPEC-kingpin Saudi’s claims to intercept a drone-laden missile launched by the Yemeni Houthis, had also added to a bearish momentum later this week, however, the Tehran-backed Yemeni Houthis had denied the accusation.
Nonetheless, key market fundamentals largely supported a bullish wind for the crude oil contracts’ prices as Baker Hughes reported that the US oil drilling rig counts had declined for the first time since November last week, while US crude oil inventories had also reported a surprise decline last week before the winter storm hit.
According to EIA (Energy Information Administration) report released earlier on Thursday, US crude inventories tumbled 7.3 barrels to 461.8 barrels last week, bottomed to their lowest level since March 2020.
Crude oil retreats from 13-month peaks, but reports weekly gain
Citing statistics, on Friday’s commodity market wind-down, UK crude futures’ prices faltered 1.6 per cent to $62.91 per barrel, while US WTI (West Texas Intermediate) crude oil futures’ prices plunged 2.1 per cent to settle down at $59.24 a barrel.
In the week, Brent crude added roughly 0.5 per cent, while US crude contracts’ prices rose by 0.7 cent. Meanwhile, referring to an uncertain crude oil market outlook over the coming weeks as Texas refiners were preparing to resume operations by next Friday, Ritterbusch said in a client note, “While much of the selling relates to a gradual resumption of power in the Gulf coast region ahead of a significant temperature warmup, the magnitude of this week’s loss of supply may require further discounting given much uncertainty regarding the extent and possible duration of lost output. ”