Oil prices incur a weekly loss of 4%, amid fears of recession

Oil prices recorded a weekly decline of regarding 4%, as Brent crude fell by 4.1%, while West Texas Intermediate crude fell 3.4%, following the first monthly decline since November. Prices sank on Tuesday, when Brent crude fell $10.73.
This came despite the rise in oil prices by regarding 2% in volatile trading, on Friday, but recorded a weekly decline, as concern overshadowed a possible decline in demand as a result of the stagnation on limited global supplies.
Central banks around the world are raising interest rates to curb inflation, raising fears that higher borrowing costs will stifle growth, while mass Covid-19 testing in Shanghai this week has raised concerns regarding possible shutdowns that may also hurt oil demand.
On Friday, Brent crude futures rose $2.37, or 2.3%, to settle at $107.02 a barrel. US West Texas Intermediate crude rose $2.06, or 2 percent, to $104.79 a barrel.
US non-farm payrolls data showed job growth increased more than expected in June, a sign of continued strength in the labor market, giving the Federal Reserve more incentive to raise interest rates by another 75 basis points later this month.
“The oil market views the jobs report as a double-edged sword,” said Phil Flynn, an analyst at Price Futures Group.
“The job number was positive from a demand perspective. On the other hand, the market is concerned that if the labor market is strong, the Federal Reserve might be more aggressive in raising interest rates.”
Baker Hughes Energy Services said US energy companies this week added two oil rigs, bringing the total to 597, the highest level since March 2020.
“Economic concerns may have pressured oil prices this week, but the market is still sending bullish signals,” said Stephen Brennock of BVM Brokerage. This is because the supply shortage will likely increase.”
The Western embargo on Russian oil exports has boosted prices and diverted flows as the Organization of the Petroleum Exporting Countries (OPEC) and its allies struggle to deliver on the production increases they have pledged.
Russian President Vladimir Putin has warned the West that continued sanctions once morest Moscow might lead to a “catastrophic” rise in energy prices for consumers around the world.
(Archyde.com)