Crude oil prices extended gains on Friday and registered fresh September highs just above the $67 handle. The futures finished marginally below this level and was the fourth weekly gain in a row. Brent has been following the upbeat sentiment in the stock markets, where a Santa Claus rally continues, backed by a widespread investor optimism over the US-China trade deal.
The market is still supported by trade hopes that in turn help to ease market concerns over the state of the global economy. Additionally, oil prices derived a local support from the EIA data. The official report showed that crude oil stockpiles contracted 5.5 million barrels in the week to December 20, more than the expected 1.7-million-barrels decline. Meanwhile, Baker Hughes reported that the number of active U.S. rigs drilling for oil fell by 8 to 677 last week.
At this stage, the bullish trend in the oil market remains firmly intact, with futures continue to target fresh highs despite the overbought conditions. On the other hand, unless fresh positive signals emerge, traders may shift into a profit-taking mode during the last trading days of the year. On the downside, the initial support comes around the $66 handle. Once the futures confirm a break above $67, the next resistance is expected at $67.40.