Oil prices continued their downward trend on Friday, marking the third straight day of losses and closing the week lower for the first time in three weeks. The crash occurred when fears of growing supply and unexpected growth in U.S. stockpiles put strain on the market.
Brent crude futures fell by $0.28 or $0.42 to close at $66.71 per barrel, and West Texas Intermediate (WTI) crude futures fell by $0.26 or $0.41 to settle at $63.22 per barrel at 12.18 PM PST.
Analysts at ANZ say the pressure continues as OPEC+ can look into increasing production to recapture the market share it lost to U.S. shale producers. Any action to relax more output reductions of about 1.65 million barrels a day, almost one-sixth of the world demand, may be premature.
Crude stockpiles in the U.S. increased by 2.4 million barrels last week as refineries went into seasonal maintenance. Although refining activity has provided the market with support over the past few months, narrowing margins over the next few months may undermine demand.
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To make things even more volatile, U.S. President Donald Trump called on European leaders to cease the purchase of Russian oil, indicating that geopolitics might continue to cause price spikes in the immediate future despite the observed short-term weakness.
Oil prices are under pressure, and as the world energy outlook changes, supply risks and increasing inventory are piling on traders, despite oil prices.
