Investing.com - Oil prices fell sharply in low-volume trade on Friday, as concerns about a global supply glut continued to pressure prices.
The possibility of higher interest rates in the U.S., a stronger U.S. dollar and slower global economic growth, especially in China, further weighed.
On the New York Mercantile Exchange, crude oil for delivery in January tumbled $1.33, or 3.09%, to close the week at $41.71 a barrel. Trading volumes were thin on Friday due to the Thanksgiving holiday in the United States.
Despite Friday's losses, New York-traded oil futures rose $1.32, or 3.27%, on the week, the first weekly gain in four weeks.
Nymex oil futures are down more than 10% so far in November amid worries over ample domestic supplies.
The U.S. Energy Information Administration said that crude oil inventories rose by 961,000 barrels last week, the ninth straight weekly gain. Total U.S. crude oil inventories stood at 488.2 million barrels, remaining near levels not seen for this time of year in at least the last 80 years.
Elsewhere, on the ICE Futures Exchange in London, Brent oil for January delivery sank 60 cents, or 1.32%, on Friday to close the week at $44.86 a barrel. On the week, London-traded Brent futures rose 40 cents, or 0.45%.
Energy traders kept a close eye on geopolitical concerns surrounding Turkey and Russia in the wake of Turkey's downing of a Russia fighter jet on the Syria border earlier in the week.
While Syria is not a major oil producer, investors fear that the conflict could spill over to affect oil supplies in nearby countries.
The oil market has been on the defensive in recent months amid uncertainty about how quickly the global glut of crude is set to shrink.
The Organization of Petroleum Exporting Countries will meet on Friday, December 4 to review their output strategy. Most market analysts expect the oil cartel to keep their production quota unchanged despite falling prices.
Russia said it will not send high-ranking officials to the OPEC meeting, adding to expectations for no action.
Senior OPEC officials were quoted in recent days saying the group is unlikely to waver from its no-cut policy unless non-OPEC producers, such as Russia, were also in sync with the plan.
Global crude production is outpacing demand following a boom in U.S. shale oil and after a decision by OPEC last year not to cut production in order to defend market share.
In the week ahead, investors will be focusing on Friday’s U.S. nonfarm payrolls report for November, the last jobs report before the Federal Reserve decides on interest rates at its December 15-16 meeting.
The outcome of Thursday’s European Central Bank meeting will also be in focus amid speculation the central bank could ramp up its monetary stimulus program.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, November 30
The U.S. is to publish a report on manufacturing activity in the Chicago region as well as private sector data on pending home sales.
Tuesday, December 1
China is to release reports on manufacturing and service sector activity from the China Federation of Logistics and Purchasing, as well as the Caixin services index and the revised reading of the Caixin manufacturing index.
In the U.S., the Institute of Supply Management is to release data on manufacturing activity. Later in the day, the American Petroleum Institute, an industry group, is to publish its weekly report on oil supplies.
Wednesday, December 2
The U.S. is to publish the ADP report on private sector jobs creation as well as weekly data on crude oil stockpiles. Fed Chair Janet Yellen is due to speak about the U.S. economic outlook at The Economic Club of Washington D.C.
Thursday, December 3
The ECB is to announce its monetary policy decision. The rate announcement will be followed by a post-policy meeting press conference with President Mario Draghi.
The U.S. is to release data on initial jobless claims and factory orders, while the ISM is to publish data on service sector activity in the U.S. Fed Chair Yellen is due to testify about monetary policy before the Joint Economic Committee, in Washington D.C.
Friday, December 4
The U.S. is to round up the week with the closely watched report on nonfarm payrolls, while industry research group Baker Hughes (N:BHI) will release weekly data on the U.S. oil rig count.