New York — Oil prices rose on Friday but were set for a fourth successive weekly decline, as signs of disappointing global fuel demand growth outweighed fears of supply disruptions.
Brent crude futures gained 62 cents, or 0.8%, to $80.13 a barrel by 0345 GMT, while U.S. West Texas Intermediate crude futures rose 62 cents to $76.93.
Both benchmarks have declined about 7.3% over the last four weeks in the longest streak of consecutive weekly losses this year.
Disappointing economic data from top oil importer China and a survey showing weaker manufacturing activity across Asia, Europe and the United States raised the risk of an underpowered global economic recovery that would weigh on oil consumption.
“China’s road traffic saw a seasonal decline for the third consecutive year,” analysts at ANZ said in a note. “Weaker U.S. economic data suggested weakening oil demand prospects.”
Falling manufacturing activity in China also inhibited prices, adding to concerns about demand growth after June data showed imports and refinery activity were lower than last year.
Asia’s crude oil imports dropped in July to the lowest in two years, sapped by weak demand in China and India, data from LSEG Oil Research showed.
Oil investors are also cautiously watching developments in the Middle East, where the killing of senior leaders of Iran-aligned militant groups Hamas and Hezbollah stoked fears that the region could be on the brink of all-out war, threatening to disrupt supplies.
“Heightened geopolitical tensions were reflected in a rising premium for call options as traders are taking a view that prices will rise,” ANZ said, adding that Brent call option contract purchases rose to the highest volume since April.
“Oil three-month implied volatility rose to 26.6% from a low of 22.6% in mid-July.”
*Shariq Khan & Sudarshan Varadhan; editing: Clarence Fernandez – Reuters
