NEW YORK (DTN) -- New York Mercantile Exchange spot-month oil futures moved lower at the start of regular trade Friday morning amid end-year book squaring on the last business day for December, fourth quarter and 2016 in thin trade ahead of New Year's Day, with the market closed Monday in observance of the holiday.
The decline from this week's multi-month highs comes ahead of rig data from Baker Hughes Inc. set for release at 1:00 PM ET, with the oil service provider reporting eight consecutive weekly increases in the number of active oil rigs operating in the United States thought Dec. 23. Since the end of October, producers have placed 82 oil rigs into service, with the Energy Information Administration on Thursday reporting U.S. crude production at 8.766 million bpd during the week-ended Dec. 23, down 30,000 bpd from two weeks prior when it reached a seven-month high.
As of Dec. 23, there were 523 rigs in operation drilling for oil.
Today's decline follows choppy overnight trade after the EIA released a mixed set of weekly data on Thursday showing a surprise build in domestic crude oil supply and stock draws for refined products. The data showed crude stockpiles up 613,000 bbl while gasoline supplies fell by 1.6 million bbl and distillate inventories were drawn down 1.9 million bbl during the week-ended Dec. 23.
Supportive technical factors and bullish sentiment have guided the complex to multi-month highs this week, underpinned ahead of production cuts set to take effect over the weekend.
The Organization of the Petroleum Exporting Countries and 11 non-OPEC oil producing countries are set to implement their Nov. 30 and Dec. 10 agreements on Sunday that cut a combined 1.758 million bpd of oil production.
In early trade, NYMEX February West Texas Intermediate crude futures eased 18cts to $53.59 bbl with March Brent on the IntercontinentalExchange down 21cts to $56.64 bbl. NYMEX January ULSD futures eased 0.32cts to $1.7005 gallon, with the February contract down 0.37cts at $1.7163 gallon. January RBOB futures were down 1.45cts to $1.6675 gallon, with the February contract down 1.16cts at $1.6682 gallon.
NYMEX January oil products futures expire at today's close.
George Orwel can be reached at email@example.com
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