Friday, May 24, 2024

Oil prices head for second weekly decline amid recession fears

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Oil platform (AFP)

Oil prices

Brent crude is headed for a 3.8% decline this week.

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Oil prices rose on Friday but were set for a second straight weekly decline as disappointing economic data from the world’s biggest consumer of crude oil and uncertainty about a rate hike raised concerns about future fuel demand.

By 05:06 GMT, Brent crude futures for June delivery were up 62 cents, or 0.79%, at $78.99 a barrel. These deals expire on Friday.

U.S. West Texas Intermediate crude was up 45 cents, or 0.6%, at $21:75 a barrel.

Brent crude is down 3.8% this week and has fallen 9.1% over the past two weeks. WTI will fall 3.8% this week, bringing its two-week decline to 9.4%.

Data showed U.S. economic growth slowed more than expected in the first quarter, but jobless claims fell in the week ended April 22.

Investors also fear that interest rate hikes that central banks could introduce in the anti-inflation framework could slow economic growth and weaken energy demand in the United States, Britain and the European Union.

The Federal Reserve (US central bank), the Bank of England and the European Central Bank are expected to raise interest rates at their next meetings. The US Federal Reserve meets on the second and third of May.

On the supply side, Russian Deputy Prime Minister Alexander Novak said yesterday, Thursday, that despite Chinese demand being lower than expected, the “OPEC +” alliance did not see the need for further cuts in oil production, but he added. The board can always adjust its policy if necessary.

See also  Oil fall in anticipation of withdrawal from US and Chinese reserves

The “OPEC+” alliance, which includes the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, announced a total output cut of about 1.16 million barrels per day this month.

The market rebounded after the “OPEC+” announcement, but later fell due to fears of a slowdown and its impact on demand.

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Nadia Barnett
Nadia Barnett
"Award-winning beer geek. Extreme coffeeaholic. Introvert. Avid travel specialist. Hipster-friendly communicator."

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