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Growth in Active U.S. Rig Count Dooms Crude Oil Settlements on Monday

Crude oil prices traded at their lowest level in nearly a week as an uptick in active domestic rigs renewed concerns over domestic production, according to Bloomberg MarketWatch.

On the New York Mercantile Exchange, April West Texas Intermediate crude shed 56 cents, or 1.2%, to settle at $48.22 a barrel, ahead of the contract’s expiration at Tuesday’s settlement.

On London’s ICE Futures Exchange, May Brent crude, the global benchmark, fell 14 cents, or 0.3%, to end trading at $51.62 a barrel.

“Sentiment remains bearish towards oil and the fading optimism over the effectiveness of the supply cut deal could encourage sellers to attack prices further,” said Lukman Otunuga, research analyst at FXTM. “Although OPEC’s inability to balance the oil markets in the first half of 2017 has sparked speculations of the organization extending its six-month contract, the rise of U.S. shale and lingering concerns of some members not fully following the compliance in cutting production could create headwinds.”

The number of active U.S. rigs drilling for oil rose for a ninth straight week—up 14 to 631 last week, according to the Baker Hughes rig report released on Friday.

Meanwhile, April natural gas finished at $3.041 per million British thermal units, up 3.2%, on the New York Mercantile Exchange.