Oil held gains near $60 a barrel on track for a second weekly advance amid increasing signs the slowdown in U.S. drilling is reducing an oversupply.

Futures were little changed in New York and 0.7 percent higher for the week. U.S. drillers have reduced the number of operating oil rigs for a record 27 weeks to the lowest level in almost five years, according to Baker Hughes Inc., and oil stockpiles have shrunk for seven consecutive weeks. Prices rose Thursday as the dollar weakened, making commodities more attractive to investors.

Oil is trading near six-month

highs as shrinking U.S. stockpiles counter a boost in output from OPEC nations. Saudi Arabia, Iraq and the United Arab Emirates are pumping more crude as the 12-member group seeks to defend market share against higher-cost producers.

West Texas Intermediate for July delivery was at $60.37 a barrel in electronic trading on the New York Mercantile Exchange, down 8 cents at 10:09 a.m. Sydney time. The contract gained 53 cents to $60.45 on Thursday. Prices have increased about 13 percent this year.

Brent for August settlement fell 16 cents, or 0.3 percent, to $64.10 a barrel on the London-based ICE Futures Europe exchange. It gained 39 cents, or 0.6 percent, to $64.26 on Thursday. The European benchmark crude traded at a premium of $3.37 to WTI for the same month.

Source : Bloomberg