UPDATE 10-Oil boosted by OPEC+ cuts even as virus weighs on market

* Market pulls lower after Boston Fed Chair comments
* Brent earlier touched $42.92, highest since June 8
* Brent backwardation suggests tightening prompt supply
* U.S. oil and gas rigs hit record low for 7th week - Baker
Hughes

(Updates with settlement prices)
By Jessica Resnick-Ault
NEW YORK, June 19 (Reuters) - Oil prices rose on Friday but
pulled back sharply from early highs on concerns that continued
spread of the novel coronavirus could stall the United States'
economic rebound.
Crude benchmarks followed other assets lower, pulling back
from session highs after Boston Federal Reserve President Eric
Rosengren said more fiscal and monetary support for the U.S.
economy will likely be needed.
Rosengren repeated his view that the U.S. unemployment rate
will likely be "at double-digit levels" at the end of 2020 and
cautioned against reopening the economy too quickly after the
end of lockdowns aimed at containing the virus.
Heightening fears, Apple announced that it would re-close
certain stores as the virus spread further. "It's spooked everyone in North and South Carolina," said
John Kilduff, partner at energy hedge fund Again Capital in New
York.
Brent crude LCOc1 settled up 68 cents a barrel at $42.19.
U.S. crude CLc1 settled at $39.75, up 91 cents.
U.S. crude rose 8.7% this week, while Brent is up 9%.
The highs early in the session came after Iraq and
Kazakhstan, during a meeting of an OPEC+ panel on Thursday,
pledged to comply better with oil cuts, sources said. This means
curbs by the Organization of the Petroleum Exporting Countries
and allies, known as OPEC+, could deepen in July.
In a further sign of market recovery, Brent on Thursday
moved into backwardation, where oil for immediate delivery costs
more than supply later, for the first time since March.
LCOc1-LCOc2
A premium for oil for immediate delivery usually indicates
tightening supply and encourages storage to be drawn down.
U.S. crude stockpiles hit another record this week, but fuel
inventories fell. EIA/S
The U.S. oil and gas rig count, an early indicator of future
output, fell to a record low for a seventh week in a row,
dropping by 13 to 266 this week, according to data from energy
services firm Baker Hughes Co going back to 1940. RIG/U

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CHART: U.S. oil may rise to $40.01 Brent oil may rise to $43.41 Weekly changes in petroleum stocks in the U.S. https://tmsnrt.rs/3fMVOzX
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