Oil futures gained on Friday as analysts turned their attention to the expanding Canadian wildfire and uncertainty in Saudi Arabia, according to Bloomberg MarketWatch.
On the New York Mercantile Exchange, June West Texas Intermediate crude rose 34 cents, or 0.8%, to settle at $44.66 a barrel on the New York Mercantile Exchange, finishing the week lower by 2.7%.
June Brent crude on London’s ICE Futures Exchange climbed 36 cents, or 0.8%, to close at $45.37 a barrel. Brent ended the week lower by 4.2%.
Both contracts snapped a stretch of four straight weekly gains dating back to the week ended April 8, according to FactSet data.
Despite the week’s increases, crude oil prices are heading downward in what some analysts interpreted as a shift in sentiment, according to the Bloomberg report.
The out-of-control wildfire that ravaged the town of Fort McMurray in Canada’s Alberta province was slowed by rain and snow on Sunday. According to an NBC News report, officials worried the fire could exceed 1,000 square miles by morning, but on Sunday afternoon said it was being held at 621 square miles — slightly larger than the area of Oklahoma City. It is estimated that one million barrels a day of crude oil production is now offline as a result of the fire, which has lead to the evacuation of more than 85,000 people.
Saudi Arabia remains a cause for concern to market analysts, who will be closely examining Saudi Arabia’s production levels as reported in OPEC data which will be released on Friday. The kingdom regularly increases output during this time of year.
The strained relationship between Saudi Arabia and Iran diverted an earlier attempt to freeze production between OPEC and non-OPEC countries in April. Saudi Arabia announced the firing of the monarchy’s top oil minister and the creation of new Energy, Industry and Natural Resources Ministry under Khaled al-Falih, chairman of the state oil company Aramco, according to a Reuters report. The impact of the kingdom’s unexpected change in leadership within the central bank and oil ministry remains to be seen.
The Baker Hughes rig count report revealed on Friday that the number of active U.S. rigs drilling for crude fell for a seventh consecutive week. The oil rig count was down by 4 to 328 while the total U.S. rig count fell by 5 to 415 rigs, according to the report.
Analysts are concerned that the price recovery may be threatened if the decline in U.S. production slows and the rig count begins to rise soon now that prices are at levels deemed more economical by some companies.
Meanwhile, June natural gas ended at $2.1010 per million British thermal units, up 2.5 cents, or 1.2%, but finished the week lower by 3.5%.