Oil traded near $60 a barrel as companies in the U.S. reduced the number of active rigs by the slowest pace since a prolonged retreat in drilling that began in December.
Futures were little changed in New York after falling 1.7 percent on Friday. The number of rigs targeting oil dropped by one to 659, data from Baker Hughes Inc. showed. Venezuela is working with OPEC members to boost prices, President Nicolas Maduro said.
Oil’s rebound from a six-year low is faltering near $60 amid speculation that rising prices will encourage companies such as EOG Resources Inc. to add to supplies. Crude inventories in the U.S., the world’s biggest consumer, are close to the highest level in 85 years, according to the Energy Information Administration.
“The response to the price drop has been made and less people have a view that we’re heading back down to significantly lower levels,” Ric Spooner, a chief analyst at CMC Markets in Sydney, said by phone. “The market has been moving sideways now for the entire month of May. Oil would need to break above $62.60 or below $57 to really give us an indication that we’re back into some directional move.”
West Texas Intermediate for July delivery was at $59.74 a barrel in electronic trading on the New York Mercantile Exchange, up 2 cents, at 3:50 p.m. Singapore time. The contract declined $1 to $59.72 on Friday. Total volume was about 74 percent below the 100-day average. Prices, little changed in May, have gained 12 percent this year.
There will be no floor session Monday because of the U.S. Memorial Day holiday and transactions will be booked Tuesday for settlement purposes.
Brent for July settlement was 7 cents lower at $65.30 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude traded at a premium of $5.50 to WTI.
The U.S. drill rig count has decreased by 58 percent since Dec. 5, Baker Hughes, an oilfield-service company, said on its website. Crude stockpiles were at 482.2 million barrels through May 15, more than 100 million above the five-year average for this time of year, according to the EIA, the Energy Department’s statistical arm.
The Chicago Board Options Exchange Crude Oil Volatility Index closed at 31.29 on Friday, advancing for the first week since March. The gauge of hedging costs on the U.S. Oil Fund, the largest exchange-traded fund tracking crude futures, slumped 32 percent last month.
The world economy needs stable oil prices, Venezuela’s Maduro said in a national address broadcast on radio and television Sunday. The Organization of Petroleum Exporting Countries, which supplies about 40 percent of the world’s crude, is scheduled to meet June 5 in Vienna to discuss its production policy.
OPEC at a November gathering resisted calls to cut output to support prices, maintaining its collective quota at 30 million barrels a day. The 12-member group pumped 31.3 million a day in April, exceeding its target for an 11th consecutive month, a Bloomberg survey of companies and analysts showed.
In Libya, warplanes deployed by the internationally recognized government bombed a tanker carrying fuel from Greece at a port controlled by Islamist leaders, the regional coastguard commander said. Conflict has split the nation that holds Africa’s biggest oil reserves, reducing its production to about 400,000 barrels a day, according to state-run National Oil Corp.