Oil prices fell by 2% in the Friday session, recording its second consecutive weekly loss, due to concerns about falling demand in China and further measures to increase US interest rates.
And hit Brent crude price at settlement At $87.62 a barrel, down $2.16, or 2.4%, while the price of US West Texas Intermediate crude reached $80.08 a barrel, down $1.56, or 1.9%.
The benchmark recorded weekly losses, with Brent losing about 9% and West Texas Intermediate about 10%.
The rise in the US dollar, which makes oil more expensive for holders of other currencies, contributed to the drop in crude prices.
And the market witnessed a shift in the two ways indicating the easing of concerns about supplies.
Crude approached record highs earlier in the year as Russia’s invasion of Ukraine fueled those fears. In addition, the nearest-maturity contracts recorded a huge price premium compared to the later-term contracts, indicating the concern of dealers about the immediate availability of oil and their willingness to pay large sums to secure supplies.
But these concerns are diminishing. Eikon Refinitiv data showed that WTI is currently trading at a discount compared to the following month, for the first time since 2021.
This situation is also beneficial for those seeking to increase their oil stocks for later use, especially since stocks are still at low levels.
Brent crude remains in the opposite pattern despite the decline in the price premium for the nearest crude contract, compared to contracts for download after 6 months, to $3 a barrel, the lowest level since April.