Oil Rebounds After 4-Day Loss, Still Ends Wk Down 7%

SECAUCUS, NJ (DTN) – Oil prices ended up for the first time Friday (10/3) after a four-day drop pressured by oversupply worries. But the market still ended the week down 7%, its most since June.  Potential for more losses in the week ahead abound, pending the outcome of an OPEC+ meeting on Sunday (10/5) that will decide new production levels for the group.

 The NYMEX WTI futures contract for November delivery settled up $0.40, or 0.7% at $60.88 bbl. For the week, WTI lost $4.87 bbl. ICE Brent for December delivery inched up $0.43 to $64.54 bbl.

Among oil products, November RBOB gasoline futures gained $0.0085 to $1.8595 gallon. Distillates bucked the trend, with the front-month ULSD contract extending the drop from the prior session, sliding $0.0033 to $2.2402 gallon.

The U.S. dollar index softened 0.085 points to 97.455 against a basket of foreign currencies.

A confluence of bearish factors sent oil prices plunging this week, chief among them the looming prospect of a massive supply glut.

The market absorbed the return of roughly 180,000 bpd of northern Iraqi crude, only to be hit by reports that OPEC and its oil producing allies was considering further production increases for November.

After years of cutting oil production in an uphill battle against softening prices, OPEC is raising output now to win market share.

The group, which has 22 member nations and controls more than 40% of global crude  supply, made the pivot in spring this year, citing strong oil demand as justification.

This is despite the risk of even lower oil prices from such a shift. A weak oil market has historically been an anathema to OPEC.

Market sources think the least OPEC might do on Sunday is agree to another 137,000 bpd for November – a mirror of what it did for October.

The wider expectation is for a rise of 274,000 bpd to 411,000 bpd, while the loftiest estimate is a jump as much as 500,000 bpd – a number OPEC itself has called “inaccurate and misleading”.