Investing.com - Oil prices rallied sharply on Friday, as bullish comments made by the International Energy Agency helped ease concerns over a glut in global supplies.
On the New York Mercantile Exchange, crude oil for delivery in February surged $2.44, or 5.28%, on Friday to end the week at $48.69 a barrel.
A day earlier, Nymex oil plunged $2.23, or 4.6%, to end at $46.25. WTI prices touched $44.20 on Tuesday, the weakest level since March 2009.
For the week, New York-traded oil futures inched up 33 cents, or 0.67%, the first weekly gain in eight weeks.
Elsewhere, on the ICE Futures Exchange in London, Brent for March delivery jumped $1.90, or 3.94%, to settle at $50.17 a barrel.
On Thursday, London-traded Brent fell $1.59, or 3.19%, to close at $48.27. Brent hit $45.19 a barrel on Tuesday, the weakest level since April 2009.
On the week, the February Brent contract tacked on 6 cents, or 0.11%, ending seven consecutive weeks of losses.
Meanwhile, the spread between the Brent and the WTI crude contracts stood at $1.48 a barrel by close of trade on Friday, compared to $1.75 in the preceding week.
The International Energy Agency cut its forecast for the increase in non-OPEC oil supply this year by 350,000 barrels a day, amid indications lower prices had begun to curb output in some areas, including North America.
“A price recovery, barring any major disruption, may not be imminent, but signs are mounting that the tide will turn,” the IEA said in its monthly oil market report.
Industry research group Baker Hughes said Friday that the number of rigs drilling for oil in the U.S. fell by 55 last week to 1,366, the lowest since October 2013.
The number of oil rigs has declined in 11 of the last 14 weeks since hitting an all-time high of 1,609 in mid-October.
London-traded Brent prices have fallen nearly 60% since June, when it climbed near $116, while WTI futures are down almost 58% from a recent peak of $107.50 in June.
Concerns over weakening global demand combined with indications that the Organization of the Petroleum Exporting Countries will not cut output to support oil markets have weighed on prices in recent months.
At the same time, increasing supplies of crude oil from North American shale formations have helped create a glut in world markets.
Elsewhere, gold rallied to the highest level in more than four months on Friday, as demand for safe haven assets was boosted amid turmoil in the currency market, following the Swiss National Bank's surprise policy decision to scrap its peg against the euro.
EUR/CHF ended the week with losses of more than 17%, while USD/CHF closed the week with losses of nearly 15%.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, notched up its fifth successive week of gains.
The diverging monetary policy stance between the Federal Reserve, which is poised to raise interest rates, and central banks in Europe and Japan has seen the dollar strengthen broadly in recent months.
The euro fell to the weakest level since November 2003 against the greenback amid mounting expectations that the European Central Bank will embark on full blown quantitative easing as soon as its next policy meeting on January 22.
In the week ahead, investors will be focusing on Thursday’s outcome of the ECB’s policy meeting and the subsequent press conference with central bank governor Mario Draghi.
Traders are also looking ahead to a raft of Chinese economic data later this week, including reports on fourth quarter gross domestic product, as well as data on industrial production and retail sales.