Oil prices settle lower despite U.S. rig count drop

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NEW YORK, May 22 (Xinhua) -- Oil prices retreated on Friday even after data showed another slip in U.S. oil rig count.

The West Texas Intermediate (WTI) for July delivery lost 0.67 U.S. dollar to settle at 33.25 dollars a barrel on the New York Mercantile Exchange, while Brent crude for July delivery decreased 0.93 dollar to close at 35.13 dollars a barrel on the London ICE Futures Exchange.

The number of active U.S. rigs drilling for oil dropped by 21 to 237 this week, oilfield services company Baker Hughes reported on Friday. The oil rig count has now fallen for 10 weeks in a row.

For the week, WTI crude finished 12.6 percent higher and Brent rose 8.1 percent.

"The considerable reduction in supply by oil companies in the U.S. and by OPEC and its allies (OPEC+) has fuelled hopes that supply could already tighten in the third quarter," Eugen Weinberg, an energy analyst at Commerzbank Research, said in a note on Friday.

"The oil market is not out of the woods yet, however: this is because the most important component in the supply-demand equation, namely demand, remains weak (outside China)," he added.

The Organization of the Petroleum Exporting Countries and its allies, a group known as OPEC+, agreed to cut output by 9.7 million barrels per day for May and June, aiming to tackle a global supply glut on the back of the COVID-19 crisis. Enditem

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