Investing.com - Crude prices gained in Asia on Monday as rig count figures out of the U.S. aided sentiment on the supply outlook.
U.S. West Texas Intermediate (WTI) crude futures rose 0.42% to $52.06 a barrel. Meanwhile, Brent crude futures, the benchmark for oil prices outside the U.S., gained 0.28% to $57.91 a barrel.
Last week, oil prices settled higher in see-saw trade on Friday, as political tensions in the Kurdistan region continued to disrupt crude supplies.
Oil exports from Iraq's Kurdistan towards the Turkish port of Ceyhan were flowing at average rates of 216,000 barrels per day versus the usual flows of 600,000 bpd, a shipping source said.
The supply disruption in Iraq comes amid ongoing political uncertainty in the region following conflict between Iraqi and Kurdish forces. Iraqi troops marched toward Northern Iraq earlier in week and regained control of two major oilfields from Kurdish forces.
Meanwhile, in the U.S., investors mulled over data showing oil drilling activity fell for a third week in a row, extending a two-month drilling decline.
Oilfield services firm Baker Hughes said Friday that its weekly count of oil rigs operating in the United States fell by seven to 736, the lowest level since June.
The weekly rig count is an important barometer for the drilling industry and serves as a proxy for domestic oil production.
In a speech Thursday, Mohammad Barkindo, secretary-general at the Organization of the Petroleum Exporting Countries, said that the oil market is balancing at an “accelerated pace,” and demand will continue to rapidly grow in coming decades.
Despite the bullish signals, analysts warned that OPEC needs to extend its agreement to reduce oil output beyond its current March 2018 expiry date in order to rebalance the market.
The original deal, struck nearly a year ago between OPEC and 10 other non-OPEC countries led by Russia, was to cut production by 1.8 million barrels a day for six months. The agreement was extended in May of this year for a period of nine months until March 2018 in a bid to reduce global oil inventories and support oil prices.
The cartel's next meeting is set for November 30 in Vienna.
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.