Oil prices on Friday were volatile, fluctuating rapidly in a narrow range from mixed signals over positive oil demand estimates for the rest of the year countering concerns over the resurgence of a new virus wave.
International benchmark Brent crude was trading at $72.41 per barrel at 06.48 GMT for a 0.15% loss after closing Thursday at $72.52 a barrel.
American benchmark West Texas Intermediate (WTI) traded at $70.19 a barrel at the same time with a 0.14% decrease after ending the previous session at $70.29 per barrel.
On Wednesday, the US Energy Information Administration (EIA) said its weekly petroleum status report that US crude oil inventories decreased by 5.2 million barrels, or 1.1%, signaling a demand rebound in the country.
However, the report also revealed that the country's gasoline inventories rose by 7 million barrels, or 3%, during the week ending June 4. Although the hefty build was caused by less driving activity during the country’s Memorial Day weekend last week, it pressured oil prices and raised questions over the demand recovery.
The Organization of Petroleum Exporting Countries (OPEC), on the other hand, predicted in its Monthly Oil Market Report that oil demand would surge by 6% during the second half of the year.
Although the report did not rule out a possible negative outlook for the rest of the year, taking into account unforeseen developments from COVID-19 due to the emergence of new variants, it said positive mobility developments on the back of easing restriction measures and border openings in OECD Americas and Europe encouraged an upward revision to the second-quarter data.
Investor concerns about a new virus wave potentially hitting the world’s big economies are still fresh, given there has not yet been a full recovery from the pandemic.
Although more than 400 million doses of coronavirus vaccines have been administered across Europe in the last six months, the World Health Organization (WHO) on Thursday warned that vaccination rates across the continent are still insufficient to prevent a resurgence of COVID-19.
By Sibel Morrow