Oil prices rise along with Wall Street, on track for weekly gain

oil prices
Oil prices rose on Friday, despite concerns over an interview on "60 Minutes" featuring the crown prince of Saudi Arabia.  Anadolu Agency/Getty Images photo

Oil prices rose on Friday, despite concerns over an interview on “60 Minutes” featuring the crown prince of Saudi Arabia where he said Iran’s Ayatollah Khamenei is “very much like Hitler.”  Anadolu Agency/Getty Images photo.

US oil prices up on Friday over one dollar

Oil prices were up Friday and, after losses earlier in the session, are now on track for a weekly gain as crude followed the US stock market higher.  Crude prices also looked to cover short bets expected before the 60 Minutes interview with Saudi crown prince Mohammed bin Salman.

By 2:08 p.m. EDT, benchmark Brent rose $1 to $65.95/barrel, up 1.54 per cent.  US WTI rose $10.7 to $62.26/barrel and the Canadian Crude Index broke the $40 barrier, rising 92 cents to $40.41.

“Mohammed bin Salman will be on ‘60 Minutes’ on Sunday comparing Iran’s Ayatollah to Hitler, and the battle in Ghouta, Syria, is ramping up,” John Kilduff, partner at investment manager Again Capital told Reuters. “You can’t be short oil over the weekend with all that going on in the region.”

On Friday, Baker Hughes released it weekly rig count.  For the week ending March 16, there were four more oil rigs in the US, bringing the total count to 800.  At this time last year, there were 631 oil rigs operational in the United States.

In Canada, the rig count dropped significantly, falling 52 to 144.  Compared to this time in 2017, there were 149 oil rigs in Canada.

The International Energy Agency said on Thursday that while global oil demand is expected to rise this year, supply is growing at a faster pace.  This will result in higher crude inventories for the first quarter of the year, which will put pressure on oil prices.

The IEA also boosted its forecast for crude demand in 2018 to 99.3 million barrels per day (b/d) from 97.8 million b/d in 2017.  The agency added that expected supply from non-OPEC countries will expand by 1.8 million b/d this year to 59.9 million b/d.  This increase will be led by the United States.

“Producers, as we’ve gone through earnings, are showing that they’re going to remain disciplined even with a little more supportive oil price, which we think is healthy for the market,” Matt Sallee, a portfolio manager at Tortoise Capital told Reuters.

Oil prices fell earlier in the week after the US Energy Information Administration reported US crude stocks rose by 5 million barrels.  Also, the firing of the US Secretary of State, Rex Tillerson, upped political risk this week.  Tillerson is expected to be replaced by a candidate more hawkish concerning Iran and North Korea.

Comments by Saudi’s crown prince saying Riyadh would develop nuclear weapons if Iran did so, also increased global tensions.


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