© Reuters. FILE PHOTO: Oil pumping units operate at sunset at an oil field in Midland, Texas, U.S., August 22, 2018. REUTERS/Nick Oxford
Scott DiSavino
NEW YORK (Reuters) – Oil prices steadied on Friday and were expected to be largely unchanged this week, as a planned European Union ban on Russian oil balanced concerns that slowing economic growth would hurt demand.
Futures for July delivery were up 2 cents at $112.06 a barrel as of 11:07 a.m. ET (1507 GMT), compared with June U.S. West Texas Intermediate (WTI) crude Prices rose 22 cents, or 0.2 percent, to $112.43 on the final day. -moon.
The more actively traded WTI contract for July fell about 0.1% to $109.88 a barrel.
That gave WTI its fourth straight weekly gain for the first time since mid-February, while Brent rose less than 1% after falling less than 1% last week.
Crude oil’s gains were limited this week due to an uncertain demand path. Investors have been reducing exposure to riskier assets, worried about rising inflation and more aggressive central bank action.
Open interest on Nymex WTI futures fell to 1.712 million contracts on Thursday, the lowest level since July 2016 for the second day in a row.
“Risks remain tilted to the upside given China’s reopening and the EU’s continued efforts to implement an oil embargo on Russia,” said Craig Erlam, senior market analyst at OANDA.
In China, Shanghai has not indicated plans to end its prolonged city-wide lockdown on June 1, despite announcing its first new case of COVID-19 outside the quarantine zone in five days.
Energy markets expect the lifting of some coronavirus restrictions in Shanghai to boost energy demand. China is the world’s largest crude oil importer.
The EU hopes to reach an agreement on a proposed ban on Russian crude imports that includes exemptions for EU countries most reliant on Russian oil, such as Hungary.
“With Germany successfully cutting Russia’s oil imports by more than half in a short period of time, an EU embargo is increasingly likely,” consultancy BCA Research said in a report.
Big German companies are drafting a plan to use an auction system to help distribute available supplies if Russia cuts off its gas supplies, though some fear it could penalize smaller companies.
In India, April imports were the highest in 3-1/2 years, as the world’s third-largest oil importer and consumers stepped up discounts on Russian oil to fuel a recovery in demand and combat high prices.
Qatari Emir Tamim bin Hamad al-Thani expressed optimism that a deal could be reached between the United States and Iran and offered to help in the matter.
Analysts said a deal with Iran could add another 1 million bpd to the market.
In the U.S., Americans continue to lag despite record-high gasoline prices at gas stations. Regular unleaded gasoline hit a record $4.59 a gallon on Friday, the Automobile Club AAA said.
