Oil prices edge lower, but set for positive week as economic outlook improves
2024.08.15 22:06
Investing.com– Oil prices fell slightly in Asian trade on Friday, but were set for a second straight week of gains as optimism over a resilient U.S. economy and falling interest rates pushed up hopes of improving demand.
Continued caution over an Iranian strike against Israel kept traders attaching a risk premium to crude, after Hezbollah and Hamas were seen launching strikes against the country earlier this week.
But overall gains in crude were still held back by persistent concerns over an economic slowdown in top oil importer China, with mixed data released earlier this week doing little to improve sentiment.
expiring in October fell 0.1% to $80.94 a barrel, while fell 0.2% to $76.85 a barrel by 21:25 ET (01:25 GMT).
Oil set for second week of gains
Both contracts were set to rise between 1.5% and 2% this week, with gains coming on the heels of some strong U.S. economic readings and signs of easing inflation in the country.
grew more than expected in July, spurring hopes that the U.S. consumer remained resilient and presenting a positive outlook for fuel demand in the country.
Additionally, signs of cooling inflation furthered conviction that the Federal Reserve will cut interest rates in September.
The fell after the softer inflation data, further supporting oil prices, while the prospect of lower rates presented a positive outlook for crude demand.
But an unexpected build in U.S. inventories suggested that demand was cooling as the travel-heavy summer season came to a close.
China concerns, demand fears persist
China remained a key point of concern for oil markets, as economic activity in the world’s biggest oil importer showed little signs of improving.
The country’s oil imports fell for a second consecutive month in July, while a slew of economic readings for the month read mostly negative.
Concerns over China saw both the OPEC and the IEA downgrade their forecasts for oil demand growth in 2024, with the two citing policy uncertainty in the country and persistent weakness in its economy.
