Crude oil prices were on course to book their first weekly loss in a month driven lower by concern about the U.S. economy, tariffs, and the prospect of peace in the Ukraine.
At the time of writing, Brent crude was trading at $73.66 per barrel, with West Texas Intermediate at $69.97 per barrel.
Besides the above bearish factors, according to Reuters, some worry that OPEC+ will go ahead with its production cut unwinding scheduled for April, even though in a separate report the publication cited unnamed sources as saying the group was hesitant about the move in light of price movements.
The sources told Reuters that OPEC+ was watching Trump and waiting to see the consequences of the peace talks with Russia, the return of maximum pressure on Iran oil exports and, most recently, the axing of Chevron’s waiver to do business in Venezuela, which would affect the country’s exports as well.
Chevron has been exporting some 240,000 barrels of Venezuelan crude to the United States daily thanks to the waiver. The company also had big plans for its Venezuelan operations, aiming to boost exports from just one of them, Petropiar, by as much as 50% this year, to a total of 143,000 barrels daily.
The worry about the U.S. economy that weighed on oil prices this week was sparked by the Bureau of Economic Analysis’ second estimate for fourth-quarter 2024 GDP, which suggested a slowdown from 3.1% in the third quarter to 2.3% in the final one. For full 2024, growth in the world’s largest economy was estimated at 2.8%.
“Those weighing on the downside, notably U.S. tariff measures, are currently winning out,” BMI analysts said in a note cited by Reuters.
Uncertainty about the effect of tariffs is also among the factors making traders wary of oil purchases, pressuring prices this week.
Source: By Irina Slav from Oilprice.com