Oil steadied below $49 a barrel as U.S. drillers continued to boost activity, countering OPEC’s efforts to drain a global glut.
Futures were little changed in New York after falling 9.1 percent last week, the biggest weekly loss since November. Rigs targeting crude in the U.S. rose to the most since September 2015, according to Baker Hughes Inc. In Libya, crude production dropped 11 percent as clashes among rival armed groups led to the closure of some of the OPEC nation’s biggest oil-export terminals.
Oil last week broke below the $50-a-barrel level it had held above since the Organization of Petroleum Exporting Countries and 11 other nations started trimming supply on Jan. 1. U.S. crude stockpiles have climbed to a record and production surged to the highest in more than a year, while Saudi Arabia’s Oil Minister Khalid Al-Falih said global supplies are falling slower than expected. Rising U.S. output is the “main threat” to the global output deal, according to Russia’s largest producer.
“Few would bet against a further selling spree,” said Stephen Brennock, an analyst at PVM Oil Associates Ltd. in London. The market has been “vulnerable to a downward spiral” as speculators remain heavily invested despite “a lack of bullish catalysts.”