Oil prices were mixed Monday, with the global benchmark up and the U.S. benchmark lower, after drilling activity increased for a third consecutive week.
Brent crude, the global oil benchmark, rose 0.21% to $63.54 a barrel on London's ICE Futures exchange. On the New York Mercantile Exchange, West Texas Intermediate futures were trading down 0.19% at $57.25 a barrel.
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On Friday, Baker Hughes Inc. reported that the number of rigs drilling for oil rose by two last week to 751.
"Given the recent price rises and the hedging activity we've seen and the rise in rig count, it seems almost inevitable that there's going to be a large rise in U.S. production next year," said Tom Pugh, commodities economist at Capital Economics.
Goldman Sachs said it expects production outside of the Organization of the Petroleum Exporting Countries to rise by 550,000 barrels a day in the fourth quarter.
"This is largely driven by the long awaited ramp-up in U.S. shale production, which accelerated in September," the bank said in a note.
The U.S. Energy Information Administration's weekly data showed U.S. output hit a record of over 9.7 million barrels a day in the week ended Dec. 1.
Oil prices have risen by around 30% over the past six months as efforts by OPEC and other producers to cut output have helped reduce global stocks, but higher prices are motivating those outside of the agreement to boost production.
Last month OPEC, along with other major producers including Russia, agreed to extend their production cuts by nine months to the end of 2018.
"Despite the renewed OPEC commitment to rebalancing the market, our fundamental analysis shows moderate global stock builds going into 2018, and we expect the bullish momentum to fade," said analysts at Société Générale in a note published on Monday.
The bank forecasts front-month Brent to trade at $58 a barrel in the first quarter of 2018 and $56 in the second quarter.
Nymex reformulated gasoline blendstock--the benchmark gasoline contract--fell 0.1% to $1.71 a gallon. ICE gasoil changed hands at $566.00 a metric ton, up 75 cents from the previous settlement.
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(END) Dow Jones Newswires
December 11, 2017 06:15 ET (11:15 GMT)