On Friday, Crude oil prices fell as concerns over the viewpoint for worldwide economic growth outweighed elevated tensions in the Middle East which can lead to the disturbance of supply routes and send rates higher.
The United States WTI (West Texas Intermediate) crude futures were fell 1.1% at $56.72 for each barrel by 0310 GMT. On Thursday, there was no settlement cost due to the Independence Day holiday in the U.S. So, the front-month Brent crude futures fell 0.1% at $63.25 for each barrel, after closing down 0.8%.
As per the analysts, oil was under pressure due to fears over upcoming demand amid deal disputes threatening worldwide economic growth. The losses were determined by the commitment to cut production from the largest exporters of the world. It includes the members of the OPEC (Organization of the Petroleum Exporting Countries) and other producers like Russia, a grouping which is known as OPEC+.
A senior analyst at OANDA, Alfonso Esparza, said that the main factor holding back crude prices is the Global growth. The deal of OPEC+ will keep rates from falling too hard, but there should be an ending to trade protectionism for assuring the order for energy products recovers.
On Wednesday, government data showed stoking economic concerns that the latest orders for the United States factory goods fell for a second straight month in May. The U.S. Energy Information also reported weekly refuse of 1.1 million barrels in crude stocks, much lesser than the 5 million barrel draw which was reported earlier in the week by the American Petroleum Institute.
This suggests the oil demand in the U.S., the biggest crude consumer in the world can be slowing along with signs of a declining economy.
On Thursday, in Gibraltar, British Royal Marines seized a giant Iranian oil tanker for trying to take oil to Syria in infringement of EU sanctions a dramatic step that drew fury of Tehran and can raise its confrontation with the West too.