NEW YORK: Oil prices settled down nearly 2% on Friday, little changed on the week with Brent crude below $80 a barrel, as investors tempered expectations of demand growth from top oil importer China.
Brent crude futures fell $1.36, or 1.7%, to settle at $79.68 per barrel. US West Texas Intermediate crude futures declined by $1.51, or 1.9%, to $76.65.
Last week, Brent crude ended at $79.66 a barrel and WTI closed at $76.84.
On Thursday, data from China showed its economy lost momentum in July, with new home prices falling at the fastest pace in nine years, industrial output slowing and unemployment rising.
That has fed worries about a slump in demand from the top oil importer, where refineries sharply cut crude processing rates last month on tepid fuel demand.
The Organization of the Petroleum Exporting Countries on Monday cut its forecast for this year’s oil demand growth, citing softness in China. The Paris-based International Energy Agency also cited weak demand in China when it slashed its 2025 forecasts on Tuesday.
“It has been a volatile week in oil markets: on one hand you had fears of supply disruptions from a wider Middle East war, but on the other, slowing growth in China forced revisions of demand forecasts,” said Andrew Lipow, president of energy consultancy Lipow Oil Associates.
Oil futures rallied at the start of the week as traders braced for retaliation by Iran against Israel over the slaying of a Hamas leader in Tehran last month. But some of that risk was priced out because Iran has not struck yet, analysts at Commerzbank Research wrote on Friday.
“At least so far, supply disruptions have been more theoretical than actual,” said Brett Friedman, contributor for market data provider OptionMetrics. “That allows the market to focus on the demand side,” Friedman said.
A fresh round of Gaza ceasefire talks began on Thursday in Qatar. It has been paused until next week, with involved parties sending mixed signals on progress.
Copyright Business Recorder, 2024
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