Oil prices stabilize after sharp falls earlier in week

Oil prices recouped more than 1% on Friday but were on track for their biggest weekly loss this year after swelling inventories and jitters over an economic slowdown led to big falls earlier in the week.

Brent crude futures were at $68.65 per barrel at 0534 GMT, up 89 cents, or 1.3%, from their last close, with prices underpinned by OPEC supply cuts and Middle East tensions.

“Multiple supply risks remain, as tension continues between Iran and the U.S., which could turn disruptive,” ANZ bank said on Friday.

“Despite the big declines in the Brent flat price, the backwardation in the forward curve steepened this week,” U.S. investment bank Jefferies said on Friday.

“Brent oil prices are down … this week as U.S.-China trade concerns are dominating the headlines,” Jefferies bank said.

“Oil remains acutely vulnerable to any trade headlines, and with Asian currencies and stocks most likely to be dragged lower, any rallies may be short-lived,” said Jeffrey Halley, senior analyst at futures brokerage OANDA.

“In China, gasoline stockpiles at seaports were seen rising to a multi-year high, this can shrink the margins for refiners and lead to softer oil demand from China,” ANZ bank said on Friday.

Asian shares were hobbled near four-month lows on Friday on worries the U.S.-China trade spat was developing into a more entrenched strategic dispute between the world’s two largest economies.

 

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