Oil prices drop for second week on global economic worries

June 09, 2023 (MLN): Oil prices fell on Friday, extending losses for straight two weeks amid concerns over the global economic backdrop and doubts over the possibility of a nuclear deal between the United States and Iran.

Brent crude is currently trading at $75.40 per barrel, down by 0.04% on the day.

While West Texas Intermediate crude (WTI) is trading at $71.92 per barrel, down by 0.10% on the day.

On Thursday, Brent crude and WTI marked a decline of 1.64% and 2.2% respectively.

In the week, both benchmarks, Brent crude, and WTI have fallen by 1.08% and 1.44% respectively.

Satoru Yoshida, a commodity analyst with Rakuten Securities said, "Oil prices are expected to stay in a range of about $3 above and below $70 for WTI in the near term,", as Reuters reported.

Although oil prices had risen earlier in the week following Saudi Arabia’s decision to slash oil output by another 1 million barrels per day (bpd) from July, the gains were lost after rising U.S. fuel stocks and weaker-than-expected Chinese export data.

Yoshida said factors such as fears over tighter supply and higher demand as the United States enters driving season which could drive prices higher were being offset by worries over a slow pickup in China's fuel demand.

The probability of a potential interest rate hike by the FED at its June 13-14 meeting now stands at 22.9%.

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