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(Reuters) – Oil prices were steady on Friday, heading for a weekly loss, as investors mulled waning Chinese demand and a possible slowing of the U.S. Federal Reserve’s interest rate cut path.
Brent crude futures dropped 30 cents, or 0.41%, to $72.26 a barrel by 1238 GMT. U.S. West Texas Intermediate crude futures were down 24 cents, or 0.35%, at $68.46.
For the week, Brent is set to fall 2% while WTI is set to decline nearly 3%.
China’s oil refiners in October processed 4.6% less crude than a year earlier because of plant closures and reduced operating rates at smaller independent refiners, data from the National Bureau of Statistics showed on Friday.
The country’s factory output growth slowed last month and demand woes in its property sector showed few signs of abating, adding to investors’ concerns over the economic health of the world’s largest crude importer.
“China served a timely reminder about the true state of its oil sector. The country’s refinery throughput declined for the seventh successive month in October,” PVM analyst Tamas Varga said.
Speaking on Thursday, Fed chair Jerome Powell said the U.S. central bank did not need to rush to lower interest rates. Lower interest rates typically spur economic growth, aiding fuel demand.
Oil prices also fell this week as major forecasters indicated slowing global demand growth.
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“Global oil demand is getting weaker,” said International Energy Agency (IEA) Executive Director Fatih Birol on Friday at the COP29 summit.
“We have been seeing this for some time and this is mainly driven by the slowing Chinese economic growth and the increasing penetration of electric cars around the world.”
The IEA forecasts global oil supply to exceed demand by more than 1 million bpd in 2025 even if cuts remain in place from OPEC+.
OPEC meanwhile cut its forecast for global oil demand growth for this year and 2025, highlighting weakness in China, India and other regions.
Providing a floor to the price declines, U.S. gasoline stocks fell by 4.4 million barrels last week to the lowest since November 2022, the Energy Information Administration said, outweighing a 2.1 million barrel crude oil stockbuild.
“Without the weekly statistics on US oil inventories the major oil contracts would have probably settled lower (on Thursday). Gasoline supported the whole complex,” PVM’s Varga added.
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