Investing.com -- U.S . crude futures fell sharply on Friday amid ongoing concerns related to excessive supply, but still ended the week up nearly 10% as the prospects of a potential output freeze from four top producers boosted prices from near 13-year lows.
On the New York Mercantile Exchange, WTI crude for April delivery wavered between $31.36 and $32.98 a barrel before settling at $31.74, down 1.20 or 3.69% on the day. Despite Friday's decline, U.S. crude futures have surged by more than 16% since falling to $26.05 a barrel on February 11, their lowest level since 2003.
On the Intercontinental Exchange, brent crude for April delivery traded between $32.69 and $34.45 a barrel, before closing at $33.02, down 1.26 or 3.68% on the session. After dipping below $30 a barrel briefly last week, North Brent Sea futures have rallied more than 8%.
Meanwhile, the spread between the international and U.S. domestic benchmarks of crude stood at $1.28 at Friday's close.
Oil prices retreated on Friday, as investors expressed skepticism that a deal brokered by Saudi Arabia, Russia and two other OPEC members to cap production at its January levels could be completed. On Friday morning, Russia deputy-energy minister Alexey Texler attempted to gain support for the deal by asserting that it could reduce global oversupply by as much as 1.8 million barrels per day (bpd). The pact, however, may require sufficient cooperation from Iran, which has been resistant to slashing production until its output returns to pre-sanction levels from 2007. While Iran oil minister Bijan Zanganeh said earlier this week that he supported any measure that would help stabilize global oil markets, he stopped short of committing to a freeze in Iranian production.
Saudi Arabia pumped 10.2 million barrels per day of oil in January, while Russian production for the month hit a post-Soviet high at 10.9 million bpd. Saudi crude output remains near a record-high of 10.5 million bpd from last summer.
"If other producers want to limit or agree to a freeze in terms of additional production, that may have an impact on the market, but Saudi Arabia is not prepared to cut production," Saudi Arabia foreign minister Adel al-Jubeir said in an interview with Agence France-Presse on Thursday.
Investors also continued to digest a bearish inventory report from the U.S. Energy Information Agency (EIA) from the previous session. For the week ending on February 12, U.S. commercial crude stockpiles rose by 2.1 million barrels to 504.1 million, remaining near historically-high levels. At the Cushing Oil Hub, the main delivery point for NYMEX oil, inventories increased by 36,000 on the week, raising fears that the nation's largest storage facility is nearing full capacity.
Elsewhere, oil-services firm Baker Hughes said in its weekly rig count that oil rigs in the U.S. fell by 29 last week to 439, marking the ninth straight week of weekly declines. The number of oil rigs in the U.S. has fallen by more than 600 over the last year.
The U.S. Dollar Index, which measures the strength of the greenback versus a basket of six other major currencies, fell more than 0.20% to an intraday low of 96.93. With several hours left in Friday's session, the index is on pace to close slightly higher for the week.
Dollar-denominated commodities such as crude become more expensive for foreign purchasers when the dollar appreciates.