NEW YORK – Oil prices were flat on Friday, setting them up for a slight change in the week, with economic growth hurting demand due to a planned EU embargo on Russian oil.
Brent futures for July delivery rose 2 cents to 2 112.06 a barrel at 11:07 EDT (1507 GMT), while US West Texas Intermediate (WTI) rose 22 cents, or 0.2%, for June, to 11 112.43 on the last day of the month.
The more actively-traded WTI contract for July fell about 0.1% to 109.88 a barrel.
This lifted the WTI for the fourth consecutive week for the first time since mid-February, where Brent was down less than 1% after falling below 1% last week.
Crude gains were limited this week due to uncertain path of demand. Investors, worried about rising inflation and more aggressive measures by the central bank, are reducing exposure to risky assets.
Open interest in WTI futures
“Risks are leaning in the opposite direction … in the wake of China’s resumption and continued efforts by the European Union to impose a Russian oil embargo,” said Craig Erlam, a senior market analyst at ONDA.
In China, Shanghai indicated no change in the planned completion of the June 1 long city-wide lockdown, although the city announced the first new COVID-19 case outside the quarantine area in five days.
The energy market expects that lifting some coronavirus restrictions in Shanghai will increase energy demand. China is the world’s top crude importer.
The European Union is hoping to reach an agreement on a proposed ban on Russian crude imports, including engraving-outs for EU states most dependent on Russian oil, such as Hungary.
“Following Germany’s success in halving Russian oil imports in a very short period of time, an EU embargo is likely to be announced soon,” the consultancy BCA said in a note.
Germany’s big business is drafting a plan to use an auction system if Russia shuts off its gas, which will help supply rations, although some fear it could penalize smaller companies.
In India, crude oil imports peaked in 3-1 / 2 years in April as the world’s third-largest oil importers and consumers increased purchases of discounted Russian oil to recover fuel demand and fight high prices.
Qatar’s Emir Tamim bin Hamad al-Thani has expressed hope that an agreement could be reached between the United States and Iran, ready to help.
Analysts say an agreement with Iran could increase oil supplies to the market by another 1 million bpd.
In the United States, Americans continue to get behind the wheel, despite the record high prices of gasoline at the pump. Auto Club AAA says regular unleaded gasoline hit a record $ 4.59 per gallon on Friday. (Additional report by Noah Browning in London and Sonali Paul in Melbourne; Editing by Frank Jack Daniel, Jason Neely, Alexander Smith and Susan Fenton)