Investing.com – Crude settled lower on Friday, as investors grew concerned that growing levels of U.S. oil production would offset OPEC’s efforts to rein in supply.
On the New York Mercantile Exchange crude futures for June delivery shed $1.09 to settle at $49.62 a barrel, while on London's Intercontinental Exchange, Brent shed $1.13 cents to trade at $51.86 a barrel.
Crude oil prices posted a nearly 7% loss for the week, falling below the key $50 a barrel level, after Saudi Oil Minister Khalid Al-Falih expressed concerns that rising U.S. oil output would undermine the effectiveness of extending the current OPEC-led deal to cut supply, beyond June.
Saudi Energy Minister Khalid al-Falih said earlier during the week, “there is consensus building [concerning a possible extension to the OPEC-led deal] but it’s not done yet”.
Meanwhile, U.S. drilling activity didn’t show any sign of a slowdown, after Oilfield services firm Barker Hughes reported Friday, its weekly U.S. rig count rose by 5 to 688.
Concerns over rising levels of U.S. oil production resumed this week, after the Energy Information Administration (EIA) reported bearish crude inventories earlier this week, and released a report, which showed U.S. shale production was set to rise to 5.19 million barrels a day in May.
Market participants remained hopeful that OPEC members and other oil producers would agree to extend the current deal to cut supply beyond June at the next meeting, scheduled for May 25.
In November last year, OPEC and other producers, including Russia agreed to cut output by about 1.8 million barrels per day (bpd). The deal to cut supply came into effect in January this year for a period of six-months until June.