Oil prices lost more than 4% during the week ending Nov. 19, as the market weighed the possible impact of emergency reserve sales after reports of the US's insistence that some major oil consumers consider a coordinated release of oil stocks to deflate prices and inflation.
International benchmark Brent crude traded at $78.53 per barrel at 1202 GMT on Friday, posting a 4.13% loss from the Monday session that opened at $81.92 a barrel.
American benchmark West Texas Intermediate (WTI) registered at $75.91 per barrel at the same time on Friday, decreasing 5.88% relative to $80.66 a barrel on Monday opening.
The oil market started the week on a downward trend amid a tight market with players focused on whether the Biden Administration would manage to increase supply to reduce energy costs in the US.
However, low oil inventory levels, supported by expectations that OPEC will shy away from increasing supplies, pushed oil prices higher on Tuesday.
Nonetheless, the market is now focusing on the possibility of an increase in oil supply from reserve sales when COVID-19 cases are rising globally.
OPEC and the International Energy Agency forecasted in their respective oil market reports that more supply would be available in the upcoming months.
Releasing oil from Strategic Petroleum Reserve (SPR) is now a hot topic in the US following US President Joe Biden's recent pressure on countries like China and Japan to sell oil from their emergency reserves.
The US administration's move came after Biden said he would use all tools at its disposal, including oil releases from his country's SPR and applying export bans.
Last week, Biden said he told his top economic advisers to focus on reducing high energy prices, which he blames for the country's increasing inflation.
Biden has already exhausted some solutions to tackle this problem. He repeatedly asked OPEC and its allies, also known as OPEC+, to increase the group's output. However, the group rebuffed his requests and chose to adhere to the scheduled output rise of 400,000 barrels per day in December.
As opinions continue to be divided over the move, experts argue that the SPR is for emergency use only and this action to balance the supply/demand gap would only be short-lived.
By Firdevs Yuksel
Anadolu Agency
energy@aa.com.tr