A growth in production from the U.S. and OPEC has offset any remaining upside potential for oil prices, according to one analyst, with crude futures on track to incur a weekly loss. U.S. oil production surged by almost 600,000 barrels per day (bpd) in August, government data published on Thursday showed, hitting a record of 12.4 million. The growth was largely due to a 30 percent increase in Gulf of Mexico output. Meanwhile, a Reuters survey on OPEC production showed production rose by 690,000 bpd in October. That brought the Middle East-dominated group's total supply back up to 29.59 million bpd. "This latest ramp up in OPEC and U.S. supply extinguished any remaining pockets of upside potential," Stephen Brennock, oil analyst at PVM Oil Associates, said in a research note published on Friday. "What is more, in a further blow to those of a bullish disposition, there was more bad news on the macro front. A flurry of global factory updates showed the sector remained in the doldrums," he added. ‘Worrying' economic data In addition to a weaker-than-expected reading of Chinese factory activity on Thursday, Brennock said doubts about whether the U.S. and China would reach a conclusive trade agreement later this month had added "insult to injury." International benchmark Brent crude traded at $60.42 a barrel Friday afternoon, up around 1.3 percent, while U.S. West Texas Intermediate (WTI) stood at $55.02, more than 1.6 percent higher. The uptick in oil prices comes shortly after an unexpected bounce in Chinese manufacturing activity on Friday boosted market sentiment. Nonetheless, crude futures remained on track to register a weekly loss. Brent crude prices have fallen almost 20 percent since an April peak, while WTI prices are down more than 15 percent over the same period. "The worrying data from China, which revealed that factory activity fell for the sixth straight month whilst its services sector also continues to suffer, has meant that another stimulus from Beijing is likely to be attempted to shore up growth," Mihir Kapadia, chief executive of Sun Global Investments, said in a research note published Thursday. "We could expect prices to remain at a similar level by the end of the week as investors wait on any further developments." Late last month, analysts at Goldman Sachs predicted some upside risk to the U.S. investment bank's year-end forecast of $62 a barrel, as headwinds from U.S. producer hedging and higher recent freight rates fade. Source: CNBC
