Oil traded unchanged on Friday, October 6, after a week of profit-taking and the return of oversupply concerns led the market lower, snapping a multi-week bull run that was Brent’s longest in 16 months.
Global benchmark Brent crude futures LCOc1 were up 7 cents at $57.07 a barrel at 0848 GMT. Week on week, the contract was set for a near 1 percent loss, snapping a five-week winning streak that was the longest since June 2016.
U.S. West Texas Intermediate (WTI) crude CLc1 was at $50.59, down 20 cents. It was set to close the week down more than 2 percent, the biggest weekly loss in three months.
Investors were wary of tropical storm Nate shutting down some oil production in the Gulf of Mexico ahead of its expected arrival in the area as a hurricane on Sunday.
“The biggest impact (from Nate) could be on gasoline prices, depending on how many refineries are forced to shut down. But I don’t think we will see another bull run,” said Frank Schallenberger, head of commodity research at LBBW in Stuttgart.
In the Gulf of Mexico, BP and Chevron were shutting production at all platforms, while Royal Dutch Shell and Anadarko Petroleum suspended some activity. Exxon Mobil, Statoil and other producers have withdrawn personnel.
The prospect of extended oil production cuts by the Organization of the Petroleum Exporting Countries and other producers led by Russia had supported prices in recent sessions.
Saudi Arabia’s energy minister said on Thursday he was “flexible” regarding Moscow’s suggestion a day earlier to prolong the production-curbing pact until the end of 2018.
However, concerns linger about growing U.S. crude exports, incentivized by a hefty WTI discount to Brent prices.
“We have a couple of bearish factors like a new record for U.S. crude exports, the reopening of Libya’s biggest oilfield, a new year high in U.S. crude production and the recent strength of the U.S. dollar,” Schallenberger said.
“I expect Brent to drop below $55 a barrel and WTI below $50 in the next couple of days.”
U.S. government data showed this week that crude exports had risen to a record of nearly 2 million barrels per day, Reuters report.
