Oil prices experienced a decline on Friday due to several factors, including the potential for a ceasefire in Gaza, a stronger dollar, and faltering U.S. gasoline demand.
Brent crude futures fell by 42 cents, equivalent to 0.5%, reaching $85.36 per barrel by 0203 GMT. Similarly, U.S. crude futures shed 40 cents, also 0.5%, dropping to $80.67 per barrel. Despite these fluctuations, both contracts are expected to conclude the week with minimal changes after experiencing a more than 3% increase the previous week.
Reports of a draft resolution by the United Nations calling for a ceasefire in Gaza contributed to the downward pressure on oil prices. Additionally, profit-taking activities also played a role in driving prices lower, according to IG analyst Tony Sycamore.
U.S. Secretary of State Antony Blinken expressed optimism on Thursday regarding the ongoing talks in Qatar, suggesting a potential agreement for a ceasefire between Israel and Hamas in Gaza. This development has led to a reduction in geopolitical risks in the region, further impacting oil prices.
Meanwhile, in the United States, the world’s largest oil consumer, there has been a decline in gasoline product supplied, indicating a possible slowdown in crude demand. Gasoline product supplied fell below 9 million barrels for the first time in three weeks, signaling a potential weakening in crude demand.
The combination of these factors has contributed to the overall decrease in oil prices observed on Friday, highlighting the influence of geopolitical events and demand dynamics on global oil markets.
