Oil futures rose Friday as global investors assessed the next leg for volatile stock markets, but signs of rising crude supplies contributed to an overall weekly loss of roughly 4%.
November West Texas Intermediate crude CLX8, +0.41% rose 41 cents, or 0.6%, at $71.38 a barrel on the New York Mercantile Exchange. It was poised for a weekly loss about 3.9%. The global benchmark, Brent crude for December delivery LCOZ8, +0.10% on the ICE Europe exchange gained 51 cents, or 0.6%, at $80.77 a barrel, set to post a weekly decline of roughly 4.1%.
Both benchmarks, which were poised to suffer from their first weekly decline in five weeks, shed some 3% Thursday, and Brent briefly dropped below the closely watched $80 line. They were moving in step with a two-day selloff across global stock markets—a severe move that raised some concerns about economic resiliency and eventual energy consumption. Global equities and benchmark U.S. stock indexes moved higher on Friday, however.
On Friday morning, the International Energy Agency shared that view, saying global oil demand will grow at a slower pace than initially expected this year and next amid economic risks stemming from trade tensions and higher oil prices.
“At the heart of this softening oil demand backdrop are a myriad of downward pressures on the global economy,” said Stephen Brennock, an analyst at brokerage PVM Oil Associates Ltd. “They include rising trade tensions, Fed policy tightening, and emerging-market weakness.”
“Supply-side anguish has slinked into the equation as oil traders remain on the defense,” said Stephen Innes, Asia-Pacific head of trading at Oanda.
“Indeed, it’s hard to sugar coat this week’s inventory data, but for perpetual bulls like my self, if risk stabilizes around improving U.S.-China tension, there are some very cheap entry points on offer,” he said, noting support near and around $80 Brent.
