Crude oil prices rose sharply on Friday, extending gains from the previous session, with traders covering short positions and indulging in some bargain hunting.
Also, oil prices continued to find support after latest threat from Russia to choke off oil and gas supplies if price caps are imposed.
Reports that the Biden administration might stop dumping barrels from the U.S. Strategic Petroleum Reserve on the market after October contributed as well to oil’s uptick.
A weak dollar contributed too to the rise in oil prices. The dollar index, which had climbed to a fresh 20-year high at 110.79 earlier in the week, dropped to 108.36 in the Asian today, and despite recovering to 109.03, is down more than 0.6% from the previous close.
West Texas Intermediate Crude oil futures for October ended higher by $3.25 or about 3.9% at $86.79 a barrel. WTI crude futures gained about 2% on Thursday, after having tumbled to near 8-month low a session earlier.
Brent crude futures settled higher by $3.69 or about 4.1% at $92.84 a barrel.
WTI Crude and Brent, both posted marginal losses for the week.
Oil prices firmed on Thursday despite data from the Energy Information Administration (EIA) showing a large build-up of U.S. crude inventories last week. The data said crude inventories rose by 8.8 million barrels last week. However, analysts said the build was exaggerated by increased imports and ongoing releases from government emergency reserves.
A report from Baker Hughes said the number of active U.S. rigs drilling for oil fell by five to 591 this week, after seeing a decline of nine rigs last week.
The total active U.S. rig count, which includes those drilling for natural gas, dropped by one to 759, the data showed.
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