Crude oil futures extended rally on falling U.S. drilling rigs
Crude oil futures made bigger gains on Tuesday, after rallying 11% for the past two sessions, as investors closed out trades on lower prices after records showed the number of U.S. oil drilling rigs had dropped by the most in approximately 30 years previous week.
On the New York Mercantile Exchange (NYMEX), crude oil for delivery in March increased as much as $1.31 or 2.57%, to beat a session high of $50.88 a barrel, before trading at $50.64 during European morning session, the most since January 15, up 2.16% or $1.07.
A day before, New York-traded oil futures flowed 2.76% or $1.33, to settle at $49.57.
West Texas Intermediate (WTI) oil futures are up about 13% in the three sessions plus Tuesday, along with signals U.S. producers are pulling back on new production in reaction to low prices.
U.S. oil prices lost 10.17% or $5.96, in January, the seventh repeated monthly decline.
Elsewhere, on the ICE Futures Exchange in London, Brent oil for March delivery bounced 2.72% or $1.49, to trade at $56.24 a barrel, after growing by as much as 3.06% or $1.73, to hit $56.48, the highest level since January 5.
On Monday, London-traded Brent increased 3.32% or $1.76, to trade at $54.75. Brent prices ended January with a loss of 8.97% or $5.92, also the seventh consecutive monthly drop.
Industry research group Baker Hughes said last Friday that the number of rigs drilling for oil in the U.S. dropped by 94, or 7%, to 1,223 last week, the lowest since October 2013.
The number of oil rigs has declined in 13 of the last 16 weeks since beating an all-time high of 1,609 in mid-October.
London-traded Brent prices have dropped almost 60% since June, when it climbed near $116, while WTI futures are down nearly 58% from a recent peak of $107.50 in June, as the Organization of Petroleum Exporting Countries opposed calls to cut output, though the U.S. pumped at the highest speed in more than three decades, creating a flood in global supplies.