Investing.com -- Crude futures rose moderately on Friday afternoon, extending slight gains from earlier in the session after a closely-watched report showed that U.S. oil rigs crept up last week, providing some signals that dormant shale producers nationwide may be on the verge of ramping up output.
On the New York Mercantile Exchange, WTI crude for August delivery traded between $44.78 and $45.96 a barrel before closing at $45.30, up 0.16 or 0.35% on the session. The front month contract for U.S. crude bounced off near two-month lows, one day after sliding below $45 a barrel for the first time since early-May. On the Intercontinental Exchange (ICE), brent crude for September delivery wavered between $46.15 and $47.23 a barrel, before settling at $46.67, up 0.27 or 0.58%.
On Friday afternoon, oil services firm Baker Hughes reported that U.S. oil rigs rose by 10 to 351 last week for the week ending on July 1. It marked the fifth weekly increase in the domestic rig count over the last six weeks. The combined Oil and Gas count, meanwhile, increased by nine to 440 as gas rigs last week inched down by 1 to 89. Over the first week of June, the overall count moved higher for the first time in 2016 ending a 41-week drought.
While Baker Hughes said the average oil rig count increased by about 2% in June on a monthly basis, it still fell by approximately 50% from its level 12 months earlier. Although U.S. shale producers have been forced to slash drilling due to persistently low oil prices, many have responded by shutting down their least efficient rigs.
Oil prices recovered somewhat in Friday's session after a government report a day earlier showed a lower than expected crude inventory draw last week. Though the the U.S. Energy Information Administration (EIA) reported a decline of 2.23 million barrels on the week, analysts expected a sharper decease following estimates of a 6.7 million barrel drawdown from the American Petroleum Institute on Wednesday evening.
The U.S. Dollar Index, which measures the strength of the greenback versus a basket of six other major currencies, stood at 96.37 in U.S. afternoon trading, up 0.04% on the session. Earlier, the index hit an intraday high of 96.71, in response to a robust U.S. jobs report for the month of June.
Dollar denominated commodities such as crude become more expensive for foreign purchasers when the dollar appreciates.
U.S. crude futures are up more than 60% from their level on February 11 when they slumped to 13-year lows at $26.05 a barrel. Crude futures have still fallen precipitously over the last two years when they peaked at $115 a barrel in June, 2014.