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Copper and nickel also weakened, as did iron ore futures, while the spot price (an important consideration in the Australian market) dropped 5.1% to $65.20 a dry tonne, according to Metal Bulletin Ltd.

But shale is on the comeback trail now, aided by technological advances and leaner business models that have allowed companies to pump profitably at far lower prices than before.

Oil markets have largely priced in an extension, but if one doesn't happen crude could plunge below $40 a barrel, some analysts say.

Oil prices fell to fresh five-month lows on Friday on concerns about a persistent glut despite assurances from Saudi Arabia that Russian Federation was ready to join OPEC in extending supply cuts. On Tuesday the futures had settled at their lowest since November 30, when the Organization of the Petroleum Exporting Countries chose to cut oil supply. Brent tumbled back below US$50 in the previous session and is its lowest since Jan 14.

Oil prices sunk further in morning trade on Friday, falling on from Thursday's 5 percent drop caused by fears of another oil glut.

On Wall Street, stocks finished the day relatively flat as weak energy stocks ran up against some good earnings reports. Overnight, MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS closed 0.66 percent lower. Wall Street was poised to open slightly higher.

Hewson said gold prices had continued to come under pressure on the back of a stronger US dollar, after the US Federal Reserve left interest rates unchanged last night.

Traders also remained cautious ahead of Friday's USA government payrolls report, following March's underwhelming 98,000 figure.

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Kloza expects stockpiles to draw more quickly this quarter and next as the summer driving season gets under way, but refiners risk creating a glut of refined fuels like diesel and gasoline.

Commodity Trading Advisors were among those liquidating their oil contracts, traders said.

It took months for Opec and non-members to reach a deal, though oil-producing states started to suffer from ultra-low prices, which slumped to $27.26 in January 2016.

U.S. production "could go pretty high", Hamm said in March at the CERAWeek by IHS Markit conference in Houston, one of the largest gatherings of oil executives in the world.

There was also a sign of slowing energy demand in China, the world's second largest oil consumer, when a survey showed growth in that country's services sector in April was at its slowest in nearly a year.

While the market fixates on US production, investors are also monitoring whether producing countries have been complying with their 2016 deal to cut output around 1.8 million barrels per day (bpd) by the middle of the year.

Under the original deal, Russian Federation said it would cut average daily production by 300,000 barrels per day.