Oil prices in Asian trading on Friday retreated slightly as traders took profits at the end of a positive week. Crude oil is poised for its first weekly gain in four weeks, driven by expectations of tighter supplies.
Despite mixed signals on U.S. interest rates, crude prices remained resilient. The Federal Reserve signaled fewer rate cuts for 2024, but soft inflation data raised hopes for sustained accommodative monetary policy.
Brent oil futures for August delivery declined 0.6% to $82.22 per barrel, while West Texas Intermediate (WTI) crude futures dropped 0.7% to $77.72 per barrel as of 21:18 ET (01:18 GMT).
The week saw Brent and WTI contracts posting gains of over 3%, recovering from four-month lows. This rebound was bolstered by reassurances from the Organization of the Petroleum Exporting Countries and allies (OPEC+) on maintaining production cuts to stabilize prices.
Earlier in June, OPEC+ had hinted at potential production increases later in the year, initially unsettling crude markets. However, subsequent clarifications tying production adjustments to oil price movements eased concerns about oversupply.
In its monthly report, OPEC+ maintained its forecast for annual oil demand growth, citing expectations of reduced global interest rates supporting economic recovery.
Despite these positive developments, challenges persist. U.S. inventories unexpectedly increased last week, despite the summer travel season typically boosting demand. Additionally, the International Energy Agency lowered its demand growth forecast for the year, citing expected supply expansions outside of OPEC that could lead to future oversupply concerns.
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