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15/05/24
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Crude Prices on Track for Sharp Weekly Losses
On Friday, crude prices inched up and lifted from close to 7-week lows. They were however on track for steep weekly losses as indications of robust U.S. production and stockpiles dimmed hopes for tight crude markets in the next few months.
Brent oil futures were 0.6% higher at $84.20 per barrel, and West Texas Intermediate crude futures were 0.6% higher at $79.44 per barrel.
Despite those gains, both contracts are trading near their lowest levels in 7 weeks and were on track to lose between 5% and 6% on the week.
A surprising build in inventories in the U.S. and data that showed U.S. production has increased indicated that oil markets were not as tight as traders initially believed.
This was linked to easing fears of Middle Eastern supply disruptions, as Hamas and Israel continued to negotiate a potential ceasefire.
Worries over economic growth slowing – which may reduce demand – also had an effect this week, especially after the U.S. Federal Reserve said that it would keep interest rates higher for longer.
Average purchasing managers index data from China, the biggest crude importer, also fueled fears of sluggish demand. Business activity in China was expected to slow in April after starting the year strongly.
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