By Arab News

Oil prices were in steady in volatile trading on Friday after hitting 2016 peaks, but were on track to multi-week gains on expectations of a production freeze by major exporters and stronger US fuel demand.

Strength in world equity markets, which were up for a fifth straight week, had also boosted oil earlier. Shares of US energy companies traded near 3-1/2 month highs on Wall Street.

Brent crude was down 8 cents at $41.46 a barrel by 1746 GMT, having risen $1 earlier to a 2016 high of $42.54.

US crude was down 31 cents at $39.89, after gaining $1 earlier to a year high of $41.20.

Brent was up for a fourth straight week and US crude for a fifth week in a row, both rising 3 percent this week.

Global oversupply in oil pushed crude prices down from mid-2014 highs above $100 a barrel to 12-year lows earlier this year, bringing Brent to around $27 and US crude to about $26.

Over the past two months, prices rallied to reach above $40 after the Organization of the Petroleum Exporting Countries (OPEC) floated the idea of a production freeze.

“The market is probably too long here and needs a correction,” said Scott Shelton, energy futures broker with ICAP in Durham, North Carolina.

The combination of declining oil output, smaller crude stockpile builds and surging gasoline consumption in the US also helped the price recovery.

“Oil prices are on the verge of closing higher for the fifth straight week,” said Fawad Razaqzada, analyst at City Index trading group.