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Oil gains over 2% but records seventh weekly decline

Published Dec 07, 2023 08:52PM ET Updated Dec 08, 2023 04:42PM ET
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© Reuters. An aerial view shows an oil factory of Idemitsu Kosan Co. in Ichihara, east of Tokyo, Japan November 12, 2021, in this photo taken by Kyodo. Picture taken on November 12, 2021. Mandatory credit Kyodo/via REUTERS ATTENTION EDITORS - THIS IMAGE WAS PROVIDE
 
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By Shariq Khan

BENGALURU (Reuters) -Oil prices rose more than 2% on Friday after U.S. data supported expectations of demand growth, but both benchmarks fell for a seventh straight week, their longest streak of weekly declines in half a decade, on lingering oversupply concerns.

Brent crude futures settled at $75.84 a barrel, up$1.79, or 2.4%, while U.S. West Texas Intermediate crude futures settled at $71.23, up $1.89, or 2.7%.

For the week, both benchmarks lost 3.8%, after hitting their lowest since late June on Thursday, a sign that many traders believe the market is oversupplied.

Also fuelling the market's downturn, Chinese customs data showed its crude oil imports in November fell 9% from a year earlier as high inventory levels, weak economic indicators and slowing orders from independent refiners weakened demand.

However, Friday's gains, the first in six sessions, could be a sign that the market has found a floor for now after falling for six straight sessions, said Phil Flynn, analyst at Price Futures Group.

"Look to step in with caution but the lows should be in," he said.

U.S. Labor Department data released showed stronger-than-expected job growth, signs of underlying labor market strength that should support fuel demand in the biggest oil market.

That followed government data on Wednesday showing U.S. gasoline demand last week lagged the 10-year seasonal average by 2.5% and gasoline stocks rose by 5.4 million barrels, more than quintuple forecasts, leading to gasoline prices to plummet. [EIA/S]

Like crude, U.S. RBOB gasoline futures on Friday rebounded about 3% from two-year lows on Thursday.

"Wednesday's Energy Information Administration (EIA) report which spurred concern of soft demand on a significant increase in gasoline inventories, may not be as concerning in the wake of the strong jobs report," said Rob Haworth, senior investment strategy director at U.S. Bank Asset Management.

Offering more support to the demand enthusiasm, data showed U.S. consumer sentiment perked up much more than expected in December.

Meanwhile, Saudi Arabia and Russia, the world's two biggest oil exporters, on Thursday called for all OPEC+ members to join an agreement on output cuts just days after a fractious meeting of the producers' club.

The Organization of the Petroleum Exporting Countries and its allies last week agreed to a combined 2.2 million barrels per day (bpd) in output cuts for the first quarter of next year. The market has been concerned, however, that some members may not adhere to their commitments.

Oil gains over 2% but records seventh weekly decline
 

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Comments (5)
Sulabh Tripathi
Sulabh Tripathi Dec 08, 2023 1:55PM ET
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Will U.S. jobs report dictate Global Crude demand?? What about record domestic Crude production?? Low Gasoline Prices for festive season in U.S.?? Low demand in China?? increasing EV usage??? Warm winters in Europe and U.S.??
Brad Albright
Brad Albright Dec 08, 2023 8:23AM ET
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Must be more of President Biden's war on oil.
Ac Tektrader
Ac Tektrader Dec 08, 2023 8:23AM ET
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America is the leading world producer of crude. producting almost as much as Russia and Saudi Arabia combined..
perplexed76 .
perplexed76 . Dec 07, 2023 11:40PM ET
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stagnation in china and you can devide prices by 10. India is a joke they will never work as hard as the chinese
zhongmin du
zhongmin du Dec 07, 2023 9:36PM ET
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wti Oil under 70 will not keep long.
zhongmin du
zhongmin du Dec 07, 2023 9:34PM ET
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China import and export data reported yesterday and looks pretty well suggesting China economy doing well.
perplexed76 .
perplexed76 . Dec 07, 2023 9:34PM ET
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china report can't say China doing badly, comrade Xi will be angry
perplexed76 .
perplexed76 . Dec 07, 2023 9:34PM ET
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china data is a oxymoron
Jp Perth
Jp Perth Dec 07, 2023 9:34PM ET
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same goes for our valuation deluded markets...feds important reports can't go opposite of goldilocks soft landing. Same lies,fraud just different country.
 
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