Oil pumps are seen after sunset outside Vaudoy-en-Brie, near Paris, France. Picture: REUTERS/CHRISTIAN HARTMANN
Oil pumps are seen after sunset outside Vaudoy-en-Brie, near Paris, France. Picture: REUTERS/CHRISTIAN HARTMANN

London — Oil fell further from 2019 highs on Friday, but was set for a third consecutive week of gains due to supply cuts led by producer club Opec and by US sanctions on Iran and Venezuela.

Brent crude futures were at $67.39 a barrel at 9.42am GMT, 47c below their last close. Brent hit a four-month high of $68.69 on Thursday. The benchmark has risen by just under a third since the beginning of January, when Opec started to cut production.

US West Texas Intermediate (WTI) futures were at $59.53 a barrel, down 45c from their last settlement. WTI marked a 2019 peak in the previous session at $60.39.

Both contracts were on course for their third consecutive week of increase.

“For all the recent chatter of positive vibes and faithful oil bulls, the $70 barrier has so far proved a tough nut to crack for the European benchmark,” PVM analysts wrote.

“A sense of hesitancy has taken hold across the energy complex. Market players are waiting for a bullish catalyst to spark a decisive upside breakout. The most obvious contender would be a conclusive trade agreement between the US and China.”

As economic growth has slowed across Asia, Europe and North America, potentially denting fuel consumption, no breakthrough has emerged in the trade standoff between Washington and Beijing, at least before meetings scheduled on March 28-29.

Three in four Japanese companies expect US-China trade frictions to last until at least late 2019, a Reuters poll found.

A jump of more than 2-million barrels a day in US crude oil production since early 2018 to a record 12.1-million barrels a day has made the US the world’s biggest producer, ahead of Russia and Saudi Arabia.

This has resulted in increasing exports, which have doubled over the past year to more than 3-million barrels a day. The International Energy Agency estimated that the US would become a net crude oil exporter by 2021.

US energy firms last week reduced the number of oil rigs operating for a fourth consecutive week, with drilling slowing to its lowest in nearly a year, according to energy services firm Baker Hughes. Fresh data is due on Friday.

Still, oil prices this year have been propped up by supply cuts by oil cartel and allies such as Russia.

Beyond Opec, oil prices have been boosted by US sanctions against Opec members Iran and Venezuela.