Oil prices were largely steady on Friday, finishing the week with modest gains, but speculators sharply cut long positions during last week's rout, on concerns that an OPEC production cut was failing to reduce a global supply overhang.
Crude traded in a narrow band this week, with Brent and West Texas Intermediate bouncing in a $2.50 range as investors weighed the impact of the first oil cut from the Organization of the Petroleum Exporting Countries in eight years against rising U.S. shale oil output and high inventories.
Brent crude <LCOc1> settled up 2 cents to $51.76 a barrel while U.S. light crude <CLc1> ended up 3 cents to $48.78 a barrel. Both benchmarks gained 0.8 percent for the week.
However, oil has not been able to reclaim the range that prevailed through most of 2017 before last week's rout. Instead of rebounding to $53 a barrel, U.S. crude has remained stuck around $49. Analysts anticipate that regaining the old levels may be difficult without significant drawdown in inventories.
The potential for increased U.S. production continues to build, as Baker Hughes weekly rig count data showed an increase of 14 drilling rigs in the United States.
OPEC and non-OPEC members agreed last year to cut output by a combined 1.8 million barrels per day (bpd) in the first half of 2017. But OPEC's monthly report showed global oil stocks rose in January to 278 million barrels above the five-year average.
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