crude futures fell sharply on Friday extending recent losses

U.S. crude futures fell sharply on Friday extending recent losses, like a slight increase in domestic oil rigs last week didn‘t offset bearish reports of record global stockpiles coming from the International Energy Agency.

Upon the New York Mercantile Exchange, WTI crude for December delivery traded between a choice of $40. 23 and $42. 20 a barrel before settling at $40. 70, down 1. 08 or 2. 57% upon the day. For almost all of Friday's session, the front month contract for U. S. crude traded below $41 a barrel after slipping to its lowest level since late-August. The value for WTI crude is now approaching a six-and-a-half year low from Aug. 24 when U. S. crude futures traded at $37. 75 a barrel. To the week, Texas Long Sweet futures fell by nearly 9% after closing down in four of 5 sessions. U. S. crude is likewise down by greater than 16% since peaking above $48 a barrel in the center of last week.
Upon the Intercontinental Exchange (ICE ), brent crude for January delivery wavered between $44. 16 and $45. 45 before closing at 44. 39, down 0. 78 or 1. 73% upon the session. North Brent Sea crude is likewise inside the midst in an extended slide after closing recorded on Friday to the seventh time during the past eight sessions. Over the final eight days of trading, brent futures have lost nearly 13% in value.
On Friday afternoon, oil services firm Baker Hughes (N : BHI ) said in its weekly rig count that U. S. oil rigs increased by 2 to 574 last week to the week ending on Nov. 6. It marked the very first build in domestic oil rigs in nearly three months. The U. S. oil rig count remains considerably below its level from last fall when it peaked at above 1, 600.

Severe reductions in rig count levels typically provide indications that production could possibly be upon the verge of falling sharply.

The modest gains, however, didn‘t outweigh further signals coming from the International Energy Agency (IEA ) of growing oversupply through the entire world. In its monthly report for October, the Paris-based IEA said global crude inventories have soared to nearly 3 billion barrels, amid record supply in Iraq, Russia and Saudi Arabia. The IEA also forecasts that non-OPEC supply will decline by 600, 000 daily in 2016, as U. S. shale producers struggle to keep output at lower prices. At this type of rate, non-OPEC production could decline by its highest amount in greater than 20 years.
Crude prices have fallen greater than 45% over the final year since OPEC roiled global markets using its decision to leave its production ceiling above 30 million barrels daily inside an effort to keep market share. Any major declines in U. S. shale production could provide signals that OPEC's strategy is prevailing.