Oil prices dropped on Friday and seemed set for weekly losses as solid U.S. economic data fueled concerns that the Federal Reserve would maintain tight monetary policy to battle inflation, which may reduce fuel demand even as oil stocks grew.
By 9.46 a.m. (Thai time), Brent crude futures fell 59 cents, or 0.69%, to $84.55 per barrel, while U.S. West Texas Intermediate (WTI) crude futures dropped 53 cents, or 0.68%, to $77.96 per barrel. Both indices were expected to fall by around 2% over the course of the week.
Producer prices in the United States increased by 0.7% in January, following a 0.2% decline in December. Meanwhile, the number of people filing for unemployment benefits decreased to 194,000, compared to the 200,000 predicted in a Reuters survey.
According to Fujitomi Securities Co., Ltd. chief analyst Kazuhiko Saito, “strong U.S. data bolstered concerns over rate hikes and prompted a rise in U.S. Treasury yields, which weighed on oil and other commodity prices.”
A rise in crude oil reserves in the United States, he continued, was another factor raising tensions.
U.S. crude oil stockpiles hit a new record high last week, according to the Energy Information Administration (EIA), which was the highest level since June 2021.
