Crude-oil benchmarks traded mixed early Monday, with outages outside of the U.S. providing support for Brent, the international benchmark.
September Brent crude LCOU8, +0.91%[1] added 83 cents, or 1.1%, to $77.94 a barrel on the ICE Futures Europe exchange, after closing on Friday with a weekly slide of 2.7%, according to FactSet data. August West Texas Intermediate crude CLQ8, +0.04%[2] the U.S. benchmark, traded on either side of unchanged. It recently was up 4 cents, or less than 0.1%, to $73.84 a barrel on the New York Mercantile Exchange. On Friday, WTI oil shed 0.5% for week.
Longstanding, and expected, outages to supplies in Libya, Venezuela and Iran have helped lift crude prices, which had been on an uptrend amid efforts by the Organization of the Petroleum Exporting Countries and its allies to balance supply and demand.
During a meeting last month, OPEC agreed to lift output globally by 1 million barrels a day to help counteract lost barrels from Venezuela and Iran, where the U.S. has pulled out of a nuclear agreement and threatened to reimpose sanctions targeting Tehran’s oil exports.
Market participants also have been attentive to signs of rising supplies in the U.S., with weekly data on Friday [3]from Baker Hughes BHGE, +1.26%[4] showing that the number of active U.S. rigs drilling for oil rose by 5 to 863, marking the first such rise the past three weeks.
President Donald Trump, in a series of recent tweets[5], has called for Saudi Arabian officials, which represent the most influential faction of OPEC, to help pump more crude and lower prices.
“Oil prices started the week on a positive note despite the fact that U.S. active oil rigs rose by 5 last week. Trump’s tweets on pushing OPEC to increase production proved to have limited impact on dragging prices so far,” wrote Hussein Sayed, chief market strategist at FXTM, a Monday note.
“Backwardation continued to steepen on the Brent and WTI futures curves, reflecting tightness in oil markets. All eyes will be on OPEC’s production this month, particularly from Saudi Arabia, after Trump urged the organization to act to bring prices down,” he wrote. Backwardation refers to a situation in crude contract values where prices for oil for delivery in the near future are higher than those for later deliveries.
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