Investing.com - Crude oil futures plunged sharply on Thursday, after Western powers negotiated a tentative nuclear deal with Tehran, which could add more crude to an already oversupplied market.
On the ICE Futures Exchange in London, Brent for May delivery dropped $2.15, or 3.77%, on Thursday to settle at $54.95 a barrel by close of trade. Commodity markets remained closed on Friday for Good Friday.
For the week, Brent futures declined $1.01, or 2.59%, snapping two straight weeks of gains.
Iran reached a solution on key parameters of a deal regarding its nuclear program with a group of Western leaders late on Thursday.
As part of the preliminary accord, the U.S. and the European Union agreed to loosen financial and economic sanctions against Iran that have restricted the nation's oil supply over the last four years.
The deal has exacerbated concerns among energy traders that a glut of Iranian oil could depress prices in a global market that is already saturated with an oversupply.
Elsewhere, on the New York Mercantile Exchange, crude oil for delivery in May slumped 95 cents, or 1.9%, on Thursday to settle at $49.14 a barrel.
Despite Thursday's losses, Nymex oil prices rose 57 cents, or 0.55%, during the holiday-shortened week, amid speculation an ongoing collapse in rigs drilling for oil in the U.S. will result in lower production.
Industry research group Baker Hughes (NYSE:BHI) said Thursday that the number of rigs drilling for oil in the U.S. fell by 11 last week to 802, the 17th-straight week of declines.
Market players have been paying close attention to the shrinking rig count in recent months for signs it will eventually reduce the glut of crude flowing into the market.
Meanwhile, the spread between the Brent and the WTI crude contracts stood at $5.81 a barrel by close of trade on Friday, compared to $7.54 in the preceding week.
In the week ahead, markets outside the U.S. will remain closed on Monday for the Easter holiday. The U.S. is to release what will be closely watched data on service sector activity on Monday and the Federal Reserve is to publish the minutes of its March meeting on Wednesday.
On Friday, the Labor Department reported that the U.S. economy added 126,000 new jobs in March, the smallest increase since December 2013. Economists had forecast jobs growth of 245,000 last month.
The surprisingly weak report added to concerns over the outlook for economic growth after other recent economic data pointed to a slowdown at the start of the year.
A slowing labor market could prompt the Federal Reserve to reconsider a planned increase in interest rates. Last month the Fed indicated that the first rate increase could come as soon as June, but added that continued improvement in labor markets would be a key factor it would consider.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, April 6
Markets in Australia, New Zealand, China, Europe and the U.K. will remain closed for holidays.
In the U.S., the Institute of Supply Management is to release data on service sector activity.
Tuesday, April 7
The Reserve Bank of Australia is to announce its benchmark interest rate and publish its rate statement, which outlines economic conditions and the factors affecting the monetary policy decision.
Later in the day, the American Petroleum Institute, an industry group, is to publish its weekly report on oil supplies.
Wednesday, April 8
The Bank of Japan is to announce its benchmark interest rate and publish its rate statement. There will be a closely watched press conference following the rate announcement.
The U.S. is scheduled to publish its weekly government report on oil inventories. Later Wednesday, the Federal Reserve is to publish the minutes of its March meeting.
Thursday, April 9
The Bank of England is to announce its benchmark interest rate.
Later in the day, the U.S. is to release the weekly report on initial jobless claims.
Friday, April 10
China is to publish figures on both consumer and producer price inflation.
The U.S. is to round up the week with a report on import prices.
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