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Oil prices edged higher Friday morning as investors awaited a batch of reports on rig counts and inventories in the U.S. which have been delayed due to the Christmas holiday.
Market participants also digested a report signaling that the group known as OPEC+, including members of the Organization of the Petroleum Exporting Countries and allies like Russia, may consider ending a pact to reduce global production next year.
“As far as the production cuts are concerned, I repeat once again, this is not an indefinite process. A decision on the exit should be gradually taken in order to keep up market share and so that our companies would be able to provide and implement their future projects,” said Russian Energy Minister Alexander Novak, according to Reuters on Friday, citing Russia broadcaster Rossiya 24 TV.
The report comes days after Novak was quoted as saying that OPEC+ may consider easing output restrictions at a meeting in March.
Earlier this month, OPEC and its allies agreed to officially cut production by 500,000 barrels per day on top of its current reduction agreement, beginning in January. Those additional reductions were meant to take total output cuts for OPEC+ to 1.7 million barrels day, including the current cuts of 1.2 million barrels a day from October 2018 levels that was put into place in January 2019.
Meanwhile, Bloomberg News, citing a report from JBC Energy, is forecasting that oil production outside of OPEC and the U.S. next year is set to rise by the most in about 15 years.
Against that backdrop, West Texas Intermediate crude for February delivery US:CLF20, the U.S. benchmark grade, edged 6 cents, or 0.1%, higher at $61.73 a barrel on the New York Mercantile Exchange, after rising 0.9% on Tuesday. That settlement marked the highest for the benchmark since Sept. 16, according to Dow Jones Market Data.
February Brent crude BRNG20, +0.07%, meanwhile, added a penny, or less than 0.1%, at $67.93 a barrel on ICE Futures Europe, following a 1.1% gain in the prior session. The international benchmark also finished at a more than three-month high on Thursday.
For the week, WTI has gained 2.1%, while Brent is poised for a 2.7% weekly gain, based on last Friday’s settlement of the most-active contract.
Looking ahead, investors are watching for weekly inventory reports from The Energy Information Administration on natural-gas stores at 10:30 a.m. Eastern Time and a separate EIA report on petroleum inventories due at 11 a.m., with a forecast for a decline in crude stockpiles of 1.1 million barrels, a gain of 2.5 million barrels of gasoline and distillates estimated to climb by 1.5 million barrels, for the week ended Dec. 20, according to Econoday.
A report on rigs drilling for natural gas and oil is due at 1 p.m. from Baker Hughes, with data last week reflecting a second straight pick up in oil rigs.
That data would come after the American Petroleum Institute late Tuesday reported that U.S. crude supplies fell by 7.9 million barrels for the week ended Dec. 20, more than analysts’ consensus expectations for a draw of draw of 1.83 million barrels, according to Reuters.
Meanwhile, January natural gas NGF20, -3.75% was off 8 cents, or 3.6%, at 2.211 per million British thermal units, a day after surging 5.6% to mark its largest one-day gain since Oct. 29, according to Dow Jones Market Data. For the week, natural-gas futures have lost 5%.
