Investing.com - Oil prices finished higher for a third straight session on Friday to score a weekly gain, as investors weighed OPEC's ongoing efforts to rid the market of excess supplies against indications of rising U.S. production.
Strength in global stocks, which enjoyed their biggest weekly gain in six years, as well as weakness in the dollar also contributed to oil's strong performance.
U.S. West Texas Intermediate (WTI) crude futures for April delivery tacked on 38 cents, or around 0.6%, to close at $61.55 a barrel, its highest level in a week.
Meanwhile, April Brent crude futures, the benchmark for oil prices outside the U.S., advanced 51 cents, or roughly 0.8%, to settle at $64.84 a barrel.
For the week, WTI crude rose roughly 4.2%, while Brent added about 3.3%, clawing back some of the ground lost since late January. The gains for both benchmarks come after back-to-back weekly declines.
Sentiment was boosted after United Arab Emirates energy minister Suhail al-Mazroui said that major oil producers, led by Saudi Arabia and Russia, aim to draft an agreement on a long-term alliance to cut output by the end of this year.
That came after Saudi Energy Minister Khalid al-Falih said earlier in the week his country will be “sticking” with its policy to withhold production throughout 2018.
The Organization of the Petroleum Exporting Countries (OPEC), along with some non-OPEC members led by Russia, agreed in December to extend oil output cuts until the end of 2018.
The deal to cut oil output by 1.8 million barrels a day (bpd) was adopted last winter by OPEC, Russia and nine other global producers. The agreement was due to end in March 2018, having already been extended once.
However, fears that rising U.S. output would dampen OPEC’s efforts to rid the market of excess supplies prevented prices from rising much farther.
The number of oil drilling rigs rose by 7 last week, General Electric (NYSE:GE)'s Baker Hughes energy services firm said in its closely followed report on Friday. The count has risen by 51 oil rigs in the last four weeks, putting the total at a nearly three-year high of 798.
U.S. oil production, driven by shale extraction, rose to an all-time high of 10.27 million barrels per day (bpd), last week, putting it above top exporter Saudi Arabia and within reach of Russia's output levels.
Analysts and traders have recently warned that booming U.S. shale oil production could potentially derail OPEC's effort to curb excess supply.
Among other energy contracts, March gasoline futures increased 1.5 cents, or around 0.9%, to end at $1.750 a gallon on Friday, with prices tallying a weekly gain of 3%.
Heating oil for March edged up 1.8 cents, or 1%, to $1.910 a gallon, posting a weekly advance of 3%.
Meanwhile, natural gas futures sank 2.2 cents, or about 0.9%, to $2.558 per million British thermal units, for a weekly decline of 1%.
Natural gas prices are down almost 30% since late January, amid speculation the end of the winter heating season will bring warmer temperatures throughout the U.S. and cut into demand for the fuel.
In the week ahead, market participants will eye fresh weekly information on U.S. stockpiles of crude and refined products on Wednesday and Thursday to gauge the strength of demand in the world’s largest oil consumer and how fast output levels will continue to rise.
The reports come out one day later than usual due to Monday's President's Day holiday.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday
Markets in the U.S. will remain closed for President’s Day.
Wednesday
The American Petroleum Institute, an industry group, is to publish its weekly report on U.S. oil supplies.
Thursday
The U.S. Energy Information Administration is to release weekly data on oil and gasoline stockpiles.
The U.S. government will also publish a weekly report on natural gas supplies in storage.
Friday
Baker Hughes will release weekly data on the U.S. oil rig count.