Oil prices rose more than 1.5% in a week as the two benchmarks posted gains of 1.9% for Brent and 1.5% for US crude.
On Friday, Brent crude fell $1.06 to settle at $122.01 a barrel. US West Texas Intermediate crude also fell 84 cents to $120.67 a barrel, and the daily decline came as China imposed new closures to combat Covid-19 and US consumer prices rose more than expected.
Prices came under pressure following the US Department of Labor’s Consumer Price Index report. US consumer prices accelerated in May, as gasoline prices hit a record and the cost of services rose further, suggesting that the Federal Reserve may continue to raise interest rates to combat inflation.
Parts of Shanghai imposed new restrictions to combat Covid, and the Chinese city announced a round of mass screenings of millions of residents.
And China’s imports of crude oil in May increased regarding 12% from a year ago.
“This does not indicate that the demand for oil is rising,” said Carsten Fritsch, analyst at Commerzbank. Rather, it is likely that China acted opportunistically, as it bought crude oil from Russia at a price well below the level of the global market in order to replenish its stocks.”
Oil prices had been supported earlier by fears of possible supply disruptions in Europe and Africa.
Two oil engineers in the Sarir oil field in Libya said on Friday that the field’s production decreased following the closure of the Ras Lanuf and Es Sider ports and with a threat from one of the groups to close the Hariga port.
Regarding US supplies, the number of oil rigs operating in the United States, an indicator of future supplies, rose by six to 580 rigs this week, the highest level since March 2020.
(Archyde.com)
