Oil prices edged higher on Friday as the dollar stood near a three-year low in subdued Asian trade, with many markets closed for the Lunar New Year holiday.
NYMEX crude for March delivery was up 16 cents, or 0.3 percent, at $61.50 a barrel after settling up 74 cents on Thursday. For the week, the contract has risen nearly 4 percent after losing nearly 10 percent last week.
London Brent crude was up 26 cents, or 0.4 percent, at $64.59 after settling down 3 cents. Brent is up nearly 3 percent for the week after falling more than 8 percent last week.
“Oil is getting support from a rebound in global stock markets and a weak dollar, but the upside is limited due to a projection for rising U.S. production,” said Tomomichi Akuta, senior economist at Mitsubishi UFJ Research and Consulting in Tokyo.
“The market is quiet due to a slew of holidays in Asia.”
The dollar dragged near a three-year low against a basket of currencies on Friday, headed for its biggest weekly loss in nine months. A weaker dollar often boosts prices for oil and other dollar-denominated commodities.
Asian shares extended their recovery from two-month lows into a fifth day on Friday as Wall Street’s market volatility gauge fell, although Chinese and most Southeast Asian financial markets were closed for the Lunar New Year holiday.
Oil producers led by Saudi Arabia and Russia aim to draft an agreement on a long-term alliance by the end of this year, United Arab Emirates energy minister Suhail al-Mazroui said on Thursday.
OPEC and non-OPEC producers including Russia have been restraining production by a total 1.8 million barrels per day in a bid to prop up prices under a deal that is to expire at the end of 2018.
The move comes at a time when Asian demand is on the rise. India imported a record 4.93 million bpd in January to feed its expanded refining capacity and meet rising demand, data showed.
Oil won support earlier in the week after Saudi Energy Minister Khalid al-Falih said OPEC hopes to keep limiting crude output to leave the market tight.
However, surging U.S. production is offsetting OPEC’s efforts to curb supplies. U.S. crude output hit a record 10.27 million barrels per day last week, the Energy Information Administration (EIA) said on Wednesday, making it a bigger producer than Saudi Arabia.