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Recession fears push Oil for second weekly drop

April 28, 2023 at 11:18 am | Economic Affairs

April, 28(Agencies)— Oil prices with little dip on Friday are set for their second weekly drop as disappointing US economic and uncertainty on further interest rate hikes raised concerns about future fuel demand.
Brent crude futures for June have been trading at $78.53 a barrel, up 16 cents, or 0.2%, as of 0156 GMT.
That contract expires on Friday and the more active July contract was up 21 cents, or 0.3% at 78.43 a barrel. US West Texas Intermediate (WTI) crude was up 23 cents, or 0.3%, at $74.99 a barrel.
Brent is set to decline this week by 3.8% and is down 9.1% in the past two weeks.
WTI is on a path to drop 3.8% this week, taking its two-week decline to 9.4%.
US economic growth slowed more than expected in the first quarter, although jobless claims fell in the week ending April 22, data showed.
Investors are also worried about potential interest rate hikes by inflation-fighting central banks could slow economic growth and dent energy demand in the United States, Britain and the European Union.
The US Federal Reserve, the Bank of England and the European Central Bank are all expected to raise rates at their coming meetings.
The Fed meets over May 2-3.
Oil investors are waiting for the Fed and other central banks to move next week to see the future direction of interest rates and the global economy, said Satoru Yoshida, a commodity analyst at Rakuten Securities.
“The market is quiet due to a mixture of bullish and bearish economic data and as a recovery in the global equity market gave a relief to investors,” referring to oil’s slight rebound on Thursday.
US stocks closed higher on Thursday as strong earnings helped investors look past signs of economic weakness.
On the supply side, Russian Deputy Prime Minister Alexander Novak said on Thursday the OPEC+ group saw no need for further output cuts despite lower-than-expected Chinese demand, but that the organisation can always adjust policy if necessary.

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