Investing.com - Oil prices fell on Friday after closing at fresh three-year highs on Thursday as fears over rising U.S. production undermined a rally driven by tightening supplies and geopolitical tensions.
U.S. West Texas Intermediate (WTI) crude futures for February delivery fell by 45 cents, or around 0.73%, to end at $61.56 a barrel. WTI hit a high of $62.21 the previous day, which was its strongest since May 2015.
Brent crude futures, the benchmark for oil prices outside the U.S., lost 35 cents or 0.51% to settle at $67.72 a barrel by close of trade. Brent hit a high of $68.27 on Thursday, also the strongest level since May 2015.
Oil prices came under pressure amid ongoing fears of rising U.S. production, which remained near record levels, despite data showing the number of U.S. oil rigs fell by the most since November.
The number of oil rigs operating in the U.S. fell by five to 742, according to data from energy services firm Baker Hughes.
U.S. production jumped by 28,000 barrels a day to nearly 9.8 million barrels a day, the Energy Information Administration reported on Thursday, sparking fears that US crude production could rise above 10 million bpd.
Oil prices have been boosted by production cuts led by OPEC and by Russia, which started in January last year and are set to last through 2018. Strong compliance with the output cut deal together with robust global demand has helped spur an oil market rally since the middle of 2017.
On Thursday, the EIA reported that U.S. crude stockpiles fell by 7.4 million barrels to 424.46 million barrels. That is down 20% from their historic highs last March.
Antigovernment protests in Iran also helped support oil prices over the past week, amid fears over possible supply disruptions.
In other energy trading, gasoline futures lost 1.02% to end at $1.7891 a gallon on Friday, while heating oil was down 0.71% to $2.0622 a gallon.
Meanwhile, natural gas futures fell 3.23% to $2.787 per million British thermal units in late trade.
In the week ahead, market participants will eye fresh weekly information on U.S. stockpiles of crude and refined products on Tuesday and Wednesday to gauge the strength of demand in the world’s largest oil consumer.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Tuesday
The American Petroleum Institute, an industry group, is to publish its weekly report on U.S. oil supplies.
Wednesday
The U.S. Energy Information Administration is to release weekly data on oil and gasoline stockpiles.
Thursday
The U.S. government will publish a weekly report on natural gas supplies in storage.
Friday
Baker Hughes will release weekly data on the U.S. oil rig count.