Investing.com – Oil prices rose on Friday, but remained at an inflection point after a rough week.
Reports of record Chinese demand for crude and of producers’ struggling to boost output suggest prices should be higher. But surging stockpiles and a rise in drilling activity in the U.S. indicate the path of least resistance is lower.
The conflicting themes were on display as Brent, the global benchmark for oil, posted a drop of nearly 1% on the week, while WTI had a weekly loss of 3%.
Some think WTI will return to its recent perch above $70 per barrel and dismiss this week’s tumble as aberration, or simply profit-taking, ahead of the expiry of its front-month November contract on Monday.
“Despite the weakness into contract expiration, nothing has changed,” said Phil Flynn, an analyst at Chicago’s Price Futures Group, who’s typically bullish on oil.
He referred to an earlier 3% selloff in WTI on Aug. 15, which he said was ahead of contract expiration as well.
“That was just a correction,” he said. “So is this down move.”