Adedapo Adesanya
By Adedapo Adesanya
Oil prices leaped as they returned to gaining ways after seeing drops for the majority of the week on Friday, November 1, 2019. Major futures recorded these gains above 3 percent on the heels of a round of different factors such as strong jobs data in the United States, a fall in the number of the drilling rigs in the country as well as a more optimistic outlook surrounding the US-China trade talks.
At the time of this report on Friday, the International benchmark, Brent crude was trading up at $1.99, or 3.34 percent, to settle at $61.61 per barrel while the West Texas Intermediate (WTI) crude was recorded a rise of $1.90 or 3.51 per barrel to trade at $56.08 per barrel.
According to market experts, US oil and gas drove prices up as rig count fell again this week as the total number of active oil rigs decreased by 5 according to 691 according to the report. The week marked 10 decreases out of the last 11 weeks.
Despite not making much progress on the issue in the week, the US-China took another positive turn when the Commerce Secretary of the US, Wilbur Ross said on Friday that the initial “phase one” trade pact with China will likely be signed around mid-November.
The US-China trade war has continued to influence prospects for the global economy and global oil demand weighing heavily on prices.
Support also came from data that showed jobs growth in the US slowed at a rate less than expected what was projected in October.
Meanwhile, expansion in China’s factory activity which is at its fastest pace since 2017, raising optimism over the health of the world’s second-largest economy also supported oil prices rise on Friday.
Also lending its support to oil prices followed happenings of a leak in North Dakota in the United States and this forced TC Energy Corp to shut its 590,000-barrel-per-day (bpd) Keystone pipeline that brings Canadian crude from northern Alberta to refineries in the Midwestern part of the US.
Despite the good outlook of oil prices as recorded on Friday, it however changes nothing because the appreciation were not enough to recover losses recorded earlier in the week and this means that oil ended the week lower.
