Oil futures settled higher on Friday as U.S. prices scored a gain of more than 7% for the week, after the International Energy Agency said prices might have bottomed on expectations that falling supplies will help alleviate the global glut of crude. Crude prices have rebounded by around 40% since their lows last month.
April West Texas Intermediate crude rose 66 cents, or 1.7%, to settle at $38.50 a barrel on the New York Mercantile Exchange. The settlement was the highest since early December. For the week, prices gained roughly 7.2%, which marked a fourth straight weekly climb.
Brent crude, the global oil benchmark, rose 34 cents, or 0.9%, to $40.39 a barrel on London’s ICE Futures exchange, ending more than 4% higher on the week.
The International Energy Agency projected that U.S. oil output would fall by 530,000 barrels a day this year, while other suppliers like Brazil and Colombia would experience large losses.
“Big producers cannot foresee their operations turning any profitability and there they are forced to shut down their operations,” said Naeem Aslam, chief market analyst at AvaTrade. “This has ostensibly made an impact on the oil supply.”
In a note, Goldman Sachs analysts also suggested the oil market’s bottom may be forming. The Goldman team sees crude trading between $25 and $45 a barrel in the second quarter of 2016.
April natural gas finished at $1.822 per million British thermal units, up 3.4 cents, or 1.9%. It was up 9.4% for the week.
