By Christopher Alessi 
   -- Oil prices weakened Friday, though the declines appeared to slow a week 
      after an OPEC-led decision by major producers to cut output starting next 
      year. 
 
   -- Brent crude, the global oil benchmark, was trading down 0.6% at $61.07 a 
      barrel on London's Intercontinental Exchange. 
 
   -- West Texas Intermediate futures, the U.S. oil standard, were down 0.6% at 
      $52.29 a barrel on the New York Mercantile Exchange. 

HIGHLIGHTS

Dollar Pressure: A stronger U.S. dollar, combined with volatile equity markets, have weighed down crude, said Giovanni Staunovo, commodities analyst at UBS Wealth Management. Dollar-denominated commodities like oil tend to have an inverse relationship with the greenback, which was up 0.39% Friday morning, according to the WSJ Dollar Index.

But Mr. Staunovo said that overall "I would think oil prices are in a position of stabilizing around this level," aided by planned production curbs from the Organization of the Petroleum Exporting Countries and its allies outside the cartel, including Russia.

IEA Report: Bullish pressure on prices also came from the International Energy Agency's latest monthly oil market report. The agency on Thursday said that commercial oil stocks in the Organization for Economic Cooperation and Development rose by 5.7 million barrels in October to stand at 2.872 billion barrels. That marks the first time commercial petroleum inventories were above the latest five-year average since March.

INSIGHT

OPEC+: Oil market participants continue to weigh whether a decision by OPEC, de-facto led by Saudi Arabia, and production allies led by Russia to cut crude output by a collective 1.2 million barrels a day next year will be enough to mop up a burgeoning oil supply glut. Prices had initially risen on news of the deal last Friday by as much as 5%, before paring some of those gains at the start of this week.

"It will be chiefly up to OPEC, and Saudi Arabia above all, to bring the oil price under control by complying strictly with the agreed production cuts," analysts at Commerzbank wrote in a note Friday. "Saudi Arabia therefore intends to reduce U.S. exports in the short term," they added.

AHEAD

   -- Baker Hughes releases weekly data on the number of rigs drilling for oil 
      in the U.S., a key barometer for activity in the sector. 

Write to Christopher Alessi at christopher.alessi@wsj.com

 

(END) Dow Jones Newswires

December 14, 2018 06:44 ET (11:44 GMT)

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