NEW YORK- Oil prices jumped more than 4 percent on Friday, rebounding from a four-month low hit in the previous session, as investors who had taken short positions took profits and while US sanctions on some Russian oil shippers lent support.
Brent crude futures settled up $3.19, or about 4.1 percent , at $80.61 a barrel, while West Texas Intermediate crude (WTI) rose $2.99, or 4.1 percent , at $75.89.
“You’re getting a natural profit-taking rebound and short covering, to a degree,” said John Kilduff, partner at Again Capital LLC in New York.
Some of the losses were offset after the US imposed sanctions this week on maritime companies and vessels for shipping Russian oil sold above the Group of Seven’s price cap.
Still, both benchmarks ended the week more than 1 percent lower, their fourth straight weekly decline, mostly weighed down by a rise in US crude inventories and sustained record high production.
China’s deepening property crisis and slowing industrial growth also weighed.
“Demand growth from China has been falling short of expectations,” said Andrew Lipow, president of Lipow Oil Associates.
US oil producers have been cutting the number of active drilling rigs for nearly a year due to weaker prices. The oil rig count, however, this week rose by six, the most since February, energy services firm Baker Hughes said.
“When you have a sharp drop in price, the producers think twice about moving ahead with capital spending and projects,” said Phil Flynn, an analyst at Price Futures Group. -Reuters
