The sell-off in crude oil continued apace on Friday, with West Texas Intermediate, the US oil benchmark, dropping below the $50-a-barrel mark for the first time in over two weeks as investors question Opec’s ability to bring down excess stockpiles.
WTI declined for a fifth straight session, falling as much as 1.6 per cent to $49.46 a barrel. The drop takes the gauge’s losses this week to 7 per cent, its biggest weekly drop since March 10.
Brent, the global benchmark, shed 2.3 per cent to $51.79 a barrel. It is down 7.3 per cent for the week.
Oil has been on the backfoot this week after new data showed an unexpected rise in US gasoline stockpiles. The gain prompted analysts to question whether there would be continued robust demand for crude from US refiners.
Despite a historic agreement between Opec and major non-Opec producers to curb production, oil prices have been held back by concerns over North American drillers, which have been emboldened to ramp up production by the stabilisation in crude prices.
Indeed, US stockpiles remain stubbornly high. Schlumberger, the oilfield services group, said on Friday that the revival in North American shale-oil production has helped it return to revenue growth for the first time in over two years.