(MENAFN- Arab News) NEW YORK: Brent and US crude futures fell on Friday and headed toward weekly losses as ample supply and bulging inventories continued to keep prices in check after a rally to 2015 peaks earlier in the week.
'Though the data showed US crude inventories fell last week the products inventories were up so it looks like the crude is just being turned into products' said Dominick Chirichella senior partner at the Energy Management Institute in New York.
Crude futures turned lower after gaining earlier in the day on news that US job growth rebounded last month and also from data showing strong Chinese crude oil imports in April.
Brent June crudewas down 81 cents at $64.73 a barrel at 11:02 a.m. EDT (1502 GMT).
Off more than 2 percent for the week after hitting a 2015 peak at $69.63 Wednesday Brent is poised to snap a string of four weekly gains.
US June crude was down 36 cents at $58.58 a barrel.
After reaching its 2015 peak at $62.58 on Wednesday US crude was on pace to post a small weekly loss after eight consecutive weekly gains.
Government data showing US crude stocks fell last week helped spark Wednesday's rally but the report also showed gasoline and distillate stockpiles rose.
Crude prices tumbled on Thursday as a resurgent dollar helped pressure dollar-denominated oil and the US currency was up again on Friday.
Data on Friday showed China's crude oil imports hit a record high in April but traders noted that low prices encouraged stockpiling and pointed to plunging coal and copper imports as signs of slowed economic growth.
Nonfarm payrolls increased 223000 in the US in April but March payrolls were revised lower to only 85000 the least since June 2012.
Analysts said Brent seemed capped around $70 as oversupply continued and US producers who have sharply reduced drilling in recent months of low prices could increase production as prices rise.
'The small drop in US production in recent weeks certainly does not justify the 30-40 percent price increase' since January said Hans van Cleef senior energy economist with ABN AMRO.
'The oil market is still very much supply-driven and in the end we face a huge oversupply.'
Later on Friday oil services company Baker Hughes will publish its weekly US oil rig count a key data point for the industry's activity which has declined for 21 straight weeks.