Drop in Rig Count Gives Early Boost to Prices

Oil Holds Gain as US Drilling Eases for First Time in 7 Weeks

Oil Holds Gain as US Drilling Eases for First Time in 7 Weeks

Additionally, U.S. crude production from major shale formations is expected to rise by 131,000 bpd in April from the previous month to a record 6.95 million bpd, the U.S. Energy Information (EIA) said in a monthly report on Monday. U.S. West Texas (WTI) crude futures CLc1 fell 82 cents, or 1.3 percent, to $60.57 per barrel.

The U.S. report of larger than expected supply reports from last week is looking to extend this week according to most market speculations.

Brent crude, which is the global benchmark of crude oil, had opened 2018 at $64.73.

Energy investors are weighing increased US supply against the likelihood that the Organization of the Petroleum Exporting Countries will maintain supply cuts that have been in effect more than a year. The U.S. benchmark gained $1.92 to $62.04 on Friday.

In February, even Saudi Arabia's state oil company considered participating in these flows via a USA unit, before determining it wasn't economically viable at the time.

"Oil prices fell on the back of concerns that surging USA production. could push inventories in the US higher", ANZ bank said on Tuesday.

"We are maintaining a bearish trading stance in anticipation of a range in nearby WTI between about $58 and $63, Jim Ritterbusch, president of Ritterbusch and Associates, said in a note".

"The market switched from backwardation to contango in the crude oil curve today. that's a situation that implies weakness; it's a situation that, if it persists, will lead to an increase in storage", said Bob Yawger, director of energy futures at Mizuho in NY. Cocoa, however, rises by 3.29% to 2,546 United States dollars per metric ton.

The news is expected to be light on Monday so most traders expect the price action to be driven by the U.S. Dollar and appetite for risk.

USA stocks, though, were mixed on Monday, with the S&P 500 down 2.08 points, or 0.07 percent, at 2,784.49 and the Dow Jones Industrial Average lower by 127.52 points, or 0.5 percent, at 25,208.22.

Emerging market stocks rose 1.21 percent. The Dow Jones Industrial Average . fell 157.13 points, or 0.62 percent, to 25,178.61, the S&P 500 . lost 3.55 points, or 0.13 percent, to 2,783.02 and the Nasdaq Composite . added 27.52 points, or 0.36 percent, to 7,588.33.

The broader trend remained positive for Wall Street's main indexes, which had closed up almost 2 percent on Friday on the strength of the jobs report.

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