ALBAWABA – Oil prices rose on Friday, as reported by Reuters, on the heels of the biggest weekly drop since March, having fallen continuously for the entirety of last week.
On Friday, Brent futures rose $0.51 to $84.58 per barrel and West Texas Intermediate (WTI) crude futures edged up $0.48 to $82.79, according to Reuters.
Oil prices fell last week after US government figures showed declining gasoline consumption and increasing inventories of motor fuel, as reported by Bloomberg.
The report ignited debate on whether the earlier run-up in oil prices was affecting product demand. Yet, banks such as Goldman Sachs Group Inc. and Barclays Plc say the concerns are overdone, according to Bloomberg.
For the week, Brent posted a decline of about 11 percent and WTI slipped more than 8 percent, due to mounting concerns over high-interest rates slowing global growth and hammering demand.
Oil prices are affected by conventional supply and demand dynamics as well as other factors - Shutterstock
At one point this week, gasoline traded less than $8 above crude, halving from two weeks earlier. Diesel’s premium over crude also fell to the lowest since July, as Russia lifted its recent export ban on oil derivatives and products, Bloomberg reported.
Meanwhile, the United States (US) economy, and particularly the labor market, is still going strong, with job growth up by 336,000 in September, according to Labor Department statistics. Stronger job markets indicate underlying inflation, as these results are nearly double what economists expected for September, raising fears of yet another rate hike in the coming months.
The Organization of the Petroleum Exporting Countries (OPEC) is scheduled to update its long-term oil demand forecasts in its 2023 World Oil Outlook on October 9. Member states will meet in Riyadh, the capital of top OPEC producer Saudi Arabia.
According to Reuters, the 2022 version of OPEC's report sees oil demand reaching a plateau after 2035, whereas predictions from the IEA and some other analysts see a peak earlier.
OPEC and the IEA have repeatedly clashed in recent years, with OPEC criticising the IEA for what it sees as irresponsible predictions.
