Crude oil prices slow out of the gate early Friday as markets wait for comments from U.S. Federal Reserve leaders in Chicago. File photo by Monika Graff/UPI |
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March 3 (UPI) -- Oil prices were relatively flat early Friday as investors watched U.S. crude oil inventories ahead of a data release on exploration and production activity.
Crude oil prices lost ground in Thursday trading following reports that Russia was lagging behind its peers in terms of commitments to an effort led by the Organization of Petroleum Exporting Countries to balance an oversupplied market through managed declines. On Friday, the Kremlin said it was expecting a windfall of revenue from oil and gas after seeing declines in February.
Russian momentum could add to supply-side concerns emerging from North America. Data this week show total U.S. crude oil production gaining steady ground above 9 million barrels per day, while storage tanks remain at peak capacity.
Crude oil could get a lift from the geopolitical front as U.S. military forces launch maritime assaults on al-Qaida cells in Yemen, whose ports serve as a conduit for large volumes of global oil shipments. Elsewhere, unverified reports suggest national security issues could impede port operations in Libya, one of the OPEC members exempt from the production arrangement.
The price for Brent crude oil was relatively stable about an hour before the start of trading in New York, up 0.53 percent from the previous close to $55.37 per barrel. West Texas Intermediate, the U.S. benchmark price for oil, was up just 0.42 percent to $52.83 per barrel.
Crude oil prices may be influenced later in the day when oilfield services company Baker Hughes releases weekly data on exploration and production activity. The company's rig counts serve as a barometer for the pace of upstream operations and gains, particularly in the United States, and could indicate future increases in production.
Broader markets may react to a speech in Chicago later today from Federal Reserve Chair Janet Yellen in her last public comments before a mid-March policy meeting. Last month, Fed Gov. Jerome Powell said it may be appropriate to "gradually tighten policy as long as the economy continues to behave roughly as expected."
A rate increase would increase the value of the U.S. dollar and decrease the price for commodities like crude oil that trade in that currency.
