Skip to main content

Oil prices fell on Friday and posted a weekly loss on a faster-than-expected recovery in Saudi output, while investors also worried about global crude demand amid slowing Chinese economic growth.

During a volatile session, Brent crude futures fell 83 cents, or 1.3 per cent, to settle at $61.91 a barrel, after dropping to a session low of $60.76 a barrel.

U.S. West Texas Intermediate (WTI) crude futures fell 50 cents, or 0.9 per cent, to settle at $55.91 a barrel. It hit a session low of $54.75 a barrel.

Story continues below advertisement

Brent fell 3.7 per cent for the week, its biggest weekly loss since early August. WTI lost 3.6 per cent, its steepest loss since mid-July.

Crude futures fell along with other higher-risk assets after news the U.S. government is considering the possibility of delisting Chinese companies from U.S. exchanges, a source briefed on the matter said on Friday. The move would be a radical escalation of trade tensions between the U.S. and China.

Earlier in the session, futures fell after Iranian President Hassan Rouhani said the United States offered to remove all sanctions on Iran in exchange for talks. However, U.S. President Donald Trump then said he had refused the request by Tehran.

“We’ve really been following headline to headline,” said Phil Flynn, an analyst with Price Futures Group in Chicago.

Also weighing on prices, a Wall Street Journal report citing unnamed sources said Saudi Arabia had agreed a partial ceasefire in Yemen, said analysts in the Reuters Global Oil Forum.

“Saudi Arabia has occupied centre stage in prompting a major upswing in oil price volatility through most of this month both on a daily and weekly basis,” Jim Ritterbusch, of Ritterbusch and Associates, said in a note.

Brent is just above its level before attacks on Saudi facilities on Sept. 14, which initially halved the kingdom’s production.

Story continues below advertisement

Sources told Reuters this week that Saudi Arabia had restored capacity to 11.3 million barrels per day. Saudi Aramco has yet to confirm it is fully back online.

The International Energy Agency (IEA) said it might cut its estimates for global oil demand for 2019 and 2020 should the global economy weaken further.

In China, the world’s second-largest economy and biggest importer of crude oil, industrial companies reported a contraction in profits in August.

Key oil freight rates from the Middle East to Asia rocketed as much as 28 per cent on Friday in the global oil shipping market, spooked by U.S. sanctions on units of China’s COSCO for alleged involvement in ferrying crude out of Iran.

The COSCO vessels account for about 7.5 per cent of the world’s fleet of supertankers, Refinitiv data showed.

Emerging details related to the Trump impeachment inquiry also helped to dent demand sentiment, analysts said.

Story continues below advertisement

“An impeachment would add to the uncertainty of the U.S. economy,” Flynn said.

In an indication of future production, U.S. energy firms reduced the number of oil rigs this week, and for a record 10th month in a row. Drillers cut six oil rigs in the week to Sept. 27, bringing the total count down to 713, the lowest since May 2017, General Electric Co’s Baker Hughes energy services firm said on Friday.

Money managers cut their net long U.S. crude futures and options positions in the week to Sept. 24 by 8,199 contracts to 212,561, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday.

Report an error
Tickers mentioned in this story
Unchecking box will stop auto data updates
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed.

Read our community guidelines here

Discussion loading ...

Cannabis pro newsletter