REUTERS
Crude futures rose in Asian trade on Friday, buoyed by renewed optimism prices may have bottomed out after official U.S. data showed oil production fell to its lowest level since November 2014, according to Reuters.
Brent futures had risen 21 cents to $37.28 a barrel as of 06:27 GMT, after settling 14 cents higher in the previous session. The crude benchmark is set to end the week with a gain of more than 5%, Reuters wrote.
U.S. crude futures had climbed 20 cents to $34.77 a barrel, having settled down 9 cents in the previous session.
While U.S. crude inventories rose to a new record of 517.98 million barrels last week, output fell for a sixth straight week to 9.08 million barrels a day, according to data from the U.S. government's Energy Information Administration.
Cuts in U.S. production are providing price support, but investors are also waiting for key U.S. economic data later on Friday to give further direction, said Ben Le Brun, market analyst at Sydney's OptionsXpress.
"A lot of traders are keeping their powder dry in front of non-farm payroll data – it's the No.1 (indicator) in terms of crude consumers," he said.
Read alsoOil prices fall ahead of U.S. inventory data"Investors are a little more confident we've seen a bottom in oil (prices)," he added. Le Brun is forecasting oil prices will hover around $40 by the middle of this year.
Positive numbers for both February payrolls and U.S. jobs data, both due at 13:30 GMT on Friday, could maintain the momentum of higher oil prices, Le Brun said.
"With the recent strong U.S. economic data, it is very unlikely that non-farm payrolls would underperform. We expect this to give markets more confidence in the U.S. economy," Singapore's Phillip Futures said in a note on Friday.
The decline in U.S. production will fuel a 1.5% drop in oil supply by non-members of oil producers' cartel OPEC this year, the first year of non-OPEC negative supply growth since 2008, Paul Bloxham, chief Australia economist at HSBC said in a report on Friday.
Non-OPEC supply is forecast to fall by 850,000 barrels a day this year, of which 760,000 barrels will be cut from U.S. production.
HSBC, which kept its price forecasts unchanged, assumed an average Brent price of $45 a barrel this year, rising to $60 in 2017 and $75 thereafter.