Oil prices are falling after the unemployment report and are on track to post their biggest weekly loss in three months. Prices have been driven lower recently mainly by demand concerns and high interest rates.
Fed
Around 18:15 CET, North Sea Brent crude oil was losing 0.5 percent to sell at $83.29 a barrel. U.S. WTI light crude oil was down 0.7 percent at the same time to $78.42 a barrel.
Fewer new jobs were created in the US than expected in April and the unemployment rate rose slightly. Year-on-year wage growth then slowed, US Labor Department data showed. This has prompted traders to increase bets that the US central bank (Fed) will cut interest rates this September.
Oil price
This week, the Fed left interest rates unchanged, but warned that inflation remains high, which could delay a rate cut. Analysts fear that higher interest rates for a longer period of time will slow economic growth in the United States, the world’s largest consumer of oil, as well as in other countries. That could reduce demand for oil.
Oil prices are also being depressed by hopes for a truce in the Middle East and a sharp rise in oil inventories in the United States last week.
The next meeting of the OPEC+ group of oil producers, which includes members of the Organisation of Petroleum Exporting Countries and its allies led by Russia, is due to take place in early June. Three sources from the group told Reuters that if oil demand does not pick up, OPEC+ could extend voluntary production cuts.
Source: ČTK
