Oil prices on track for weekly loss on U.S. production concerns

Oil prices fell in European trade on Friday, resuming the decline that stopped in the last two days, and heading for a weekly loss on concerns about the mounting U.S. oil rig count, indicating increased shale production, which offset the news of Saudi Arabia's output cuts to achieve market balance quickly and underpin prices.
 
As of 12:55 GMT, U.S. crude fell to $52.55 a barrel from the opening price of $53.02, with an intraday high at $53.15, and a low at $52.29.
 
Brent crude fell to $55.50 a barrel from the opening of $56.02, with a session-high at $56.19, and a low at $55.27.
 
U.S. crude February futures closed up 1.3% yesterday, the second daily gain in a row, while Brent March futures jumped 1.4%, scoring the largest two-day profit since late November.
 
Oil prices racked up strong gains in the last two days as OPEC members cut production in accordance with OPEC deal in cooperation with other producers, aiming to cut global output by 1.8 million bpd.
 
Saudi Arabia announced cutting production to below 10 million bpd, which is a decline by more than 486 thousand bpd, as the kingdom aim to achieve market balance quickly.
 
Oil prices also drew support from dollar's tumble to a five-week low yesterday against a basket of rivals, underpinning the greenback-denominated crude futures as they become cheaper to holders of other currencies.
 
Traders await later data today on the U.S. rig count from Baker Hughes, expected to rise for the eleventh week in a row from the current 529 total, already the highest since last January.
 
As oil rigs increase in the U.S., concerns mount over the increasing shale production, the main reason for the slump in oil prices since June 2014.