[NEW YORK] Oil notched its sixth straight weekly loss, weighed down by concerns over whether OPEC and its allies can reduce production enough to stanch a global supply glut.
After bouncing between gains and losses on Friday, futures were unchanged at the close of New York trading, encapsulating the uncertainty in the market after a tumultuous week. US oil prices plunged 7.1 per cent on Tuesday, the most in three years, before recovering some ground later in the week.
The Organization of Petroleum Exporting Countries (OPEC) is expanding the depth of output cuts under consideration in the face of a weakening demand outlook, offering a potential boost to prices. But in the US, stockpiles climbed the most in 21 months last week.
"The odds are fairly good that OPEC is going to cut production again but none of us know for sure," said James Williams, president at WTRG Economics in London, Arkansas. "I don't think there's enough certainty that we can expect any stability or trend in prices until we have a better idea of what OPEC is doing."
Oil is in a bear market after plunging from a four-year high in October amid a confluence of supply, demand and geopolitical pressures. The worldwide demand outlook remains uncertain amid trade tensions between the US and China, and speculation is swirling over OPEC's strategy before it meets with Russia and other producers in Vienna next month.
After the "remarkable" plunge in oil markets earlier this week, "the Saudis need higher oil prices to support their economy," said Trip Rodgers, who oversees US$200 million at the Hennessy BP Energy Fund in Dallas. "OPEC will move to cut production."
West Texas Intermediate (WTI) for December was unchanged at US$56.46 a barrel as trading closed on the New York Mercantile Exchange. Total volume traded was about 7.1 per cent above the 100-day average.
Brent for January settlement added 14 US cents to US$66.76 on the London-based ICE Futures Europe exchange. The global benchmark crude traded at a US$10.08 premium to WTI for the same month.
While Saudi Arabia has promised more supply cuts, Russian president Vladimir Putin said Thursday that an oil price of "around US$70 suits us completely." His energy minister, Alexander Novak, suggested earlier this week that the country is in no rush to act.
Meanwhile, US crude inventories rose by 10.27 million barrels last week, almost three times the median forecast, according to a government report Thursday. Domestic production edged higher to a record 11.7 million barrels a day.