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Oil records its first weekly loss in the last 5 weeks
Oil prices fell during trading on Friday, July 12, at settlement, as investors awaited weak consumer sentiment in exchange for data that supported the US Federal Reserve’s reduction of interest rates in September, and oil achieved its first weekly loss in the last five weeks.
Brent crude futures for September delivery fell by 0.43% at settlement to $85.03 per barrel, achieving a weekly loss of 1.74%.
US West Texas Intermediate crude futures for August delivery also decreased by 0.5% to $82.21 per barrel, achieving a weekly loss of 1.14%.
A monthly survey conducted by the University of Michigan showed that consumer sentiment in the United States fell to an eight-month low in July, despite improving inflation expectations for next year and beyond.
The US Labor Department said the producer price index rose 0.2% in June on a monthly basis, slightly more than expected, as the cost of services rose. However, investors expect the Fed to start cutting interest rates in September.
“The market is not afraid of the US Federal Reserve at this stage,” said Phil Flynn, an analyst at Price Futures Group.
Lower interest rates are expected to boost economic growth, which may increase fuel consumption.
“The decline in US inflation numbers may support the case for the Fed to start easing policy earlier rather than later,” said IG market strategist Yip Jun Rong.
He added: "It also adds to the series of negative surprises in American economic data, which indicate clear weakness in the American economy."
