Oil slumped in its fourth session on Friday, heading for its biggest weekly loss in five weeks, amid concerns about sharp rate hikes slowing growth in the US and hitting fuel demand.
Brent fell 48 cents, or 0.6, to $81.11 a barrel on GMT 0434. West Texas Intermediate crude (WTI) was down 60 cents, or 0.8%, at $75.12 a barrel.
Expectations of continued rate hikes in the world’s largest economy and in Europe clouded the global growth outlook, with both crude oil benchmarks lowering by more than 5.5% so far this week, the worst since early February.
US Federal Reserve Chairman Jerome Powell warned of higher and potentially faster rate hikes, saying the Fed was wrong to initially think inflation was “temporary” and was surprised by the strength of the labor market.
The labor market still looks tight, despite the number of Americans filing for unemployment benefits the highest in five months last week. Investors have become increasingly cautious.
Friday’s U.S. jobs report led to faster rate hikes, which has already triggered sharp falls in financial markets, and analysts think oil prices may also be under pressure.
All eyes are on the US data, which will be released later today, the most important guide before the Fed’s rate hike.
On the supply side, the United States has reportedly specifically urged some commodity traders to allay their concerns over price cap shipping of Russian oil to support supply, suggesting that more Russian oil could flow into the market.
Investors are closely watching Russia’s export cuts, which decided to cut oil production by 500,000 barrels a day in March.
