OIL PRICE: NOT ABOVE $64 YET
BLOOMBERG - Oil dropped below $58 a barrel as investors weighed an increase in U.S. oil drilling rigs against OPEC's promise to extend output cuts through the end of next year.
Futures fell as much as 0.9 percent in New York after adding 1.7 percent Friday. OPEC and its allies including Russia last week agreed to keep their supply cuts in place and beefed up the extension with the inclusion of Nigeria and Libya. Executives from three of the biggest independent U.S. drillers said while they won't increase activity just because prices rise after OPEC agreed to prolong curbs, they will continue to grow.
Oil has advanced for three consecutive months through November amid optimism that output cuts by Organization of Petroleum Exporting Countries and its partners are helping to balance the market. Drillers targeting crude in the U.S. added two rigs to 749 last week, the highest level since late September, according to Baker Hughes Inc.
"Even though adding Nigeria and Libya is a positive sign, OPEC has basically played all its cards after deciding to extend production curbs through next year," Will Yun, a commodities analyst at Hyundai Futures Corp., said by phone. "As long as U.S. shale suppliers exist, it will be hard to see further gains in oil prices from now on."
West Texas Intermediate for January delivery was at $57.93 a barrel on the New York Mercantile Exchange at 2:02 p.m. in Seoul, down 43 cents. The contract gained 96 cents to settle at $58.36 on Friday. Total volume traded was about 21 percent below the 100-day average.
Brent for February settlement dropped 36 cents to $63.37 a barrel on the London-based ICE Futures Europe exchange. Prices added $1.10, or 1.8 percent, to close at $63.73 on Friday. The global benchmark crude was at a premium of $5.43 to February WTI.
Pioneer Natural Resources Co., Parsley Energy Inc. and Newfield Exploration Co. said their emphasis will be on maintaining spending discipline and generating profits, rather than just boosting supply on higher oil prices. Pioneer plans to boost output from about 300,000 barrels of oil equivalent a day this quarter to more than 1 million by 2026.
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PLATTS - State-run Indian Oil Corp has signed its first US term crude oil deal, buying 6 million barrels, as the Asian buyer steps up efforts to devise an alternative buying strategy amid uncertainty about purchases from Iran because of US sanctions.
PLATTS - Angola's crude oil exports rebounded to a four-month high of 1.63 mil b/d in June even as the OPEC member struggles to arrest declines at some of its ageing deepwater oil fields, finance ministry data showed.
BAKER HUGHES A GE - U.S. Rig Count is up 13 rigs from last week to 1,057, with oil rigs up 10 to 869, gas rigs up 3 to 186, and miscellaneous rigs unchanged at 2. Canada Rig Count is down 14 rigs from last week to 209, with oil rigs down 12 to 140 and gas rigs down 2 to 69.
REUTERS - Front-month Brent crude oil futures LCOc1 were at $71.88 per barrel at 0646 GMT, down 19 cents, or 0.3 percent from their last close. U.S. West Texas Intermediate (WTI) crude futures CLc1 were down by 22 cents, or 0.3 percent, at $66.59 a barrel.