Oil prices drop again as US rig count rises
NEW YORK : Oil prices fell for the third straight session on Friday as a higher US drilling rig count added to gloom over a market glutted with petroleum.
US benchmark West Texas Intermediate for January delivery dropped 22 cents to $34.73 a barrel on the New York Mercantile Exchange, a fresh low since February 2009.
In London, Brent North Sea crude for delivery in February fell 18 cents to $36.88 a barrel.
The Baker Hughes US oil rig count showed an increase of 17 for the week ending December 18 to 541 rigs, a piece of data that stokes worry that production will stay high.
Oil prices have fallen from more than $100 a barrel in July 2014 due to high output from the US and key members of the Organization of the Petroleum Exporting Countries, which has not cut output in response to the rout.
Kyle Cooper of IAF Advisors said the gain in the drilling rigs should be seen in the context of the count already being “very low” compared with last year’s 1,536.
But, Cooper said, “the fundamentals still support the downtrend” in oil prices.
This week’s decision by the Federal Reserve to hike US interest rates has also pressured oil by lifting the dollar. A stronger greenback dents demand for dollar-denominated oil in international markets.