U.S. crude oil on Friday posted a weekly loss, as the prospect of growing oil supplies from Saudi Arabia overshadowed China’s efforts to stimulate its economy.
The U.S. benchmark West Texas Intermediate fell about 5% this week, while global benchmark Brent has pulled back nearly 4%. Prices have fallen even as conflict in the Middle East escalates, with Israel launching an airstrike in Beirut targeting Hezbollah leader Hassan Nasrallah.
“It is amazing to see that … war doesn’t affect the price, and that’s because there’s been no disruption,” Dan Yergin, vice chairman of S&P Global, told CNBC’s “Squawk Box” on Friday.
“There’s still over five million barrels a day of shut in capacity in the Middle East,” Yergin said.
Here are Friday’s closing energy prices:
- West Texas Intermediate November contract: $68.18 per barrel, down 51 cents, or 0.75%. Year to date, U.S. crude oil is down nearly 5%.
- Brent November contract: $71.98 per barrel, off 38 cents, or 0.53%. Year to date, the global benchmark is down more than 6%.
- RBOB Gasoline October contract: $1.953 per gallon, down 0.42%. Year to date, gasoline is down about 7%.
- Natural Gas November contract: $2.902 per thousand cubic feet, up 5.41%. Year to date, gas is up about more than 15%.
Oil sold off Thursday on a report that Saudi Arabia is committed to increasing production later this year, even if it results in lower prices for a prolonged period.
OPEC+ recently postponed planned output hikes from October to December, but analysts have speculated that the group might delay the hikes again because oil prices are so low.
The oil sell-off erased gains from earlier in the week after China unveiled a new round of economic stimulus measures. Soft demand in China has been weighing on the oil market for months.
“The thing that’s dominated the market is the weakness in China. Half the growth in world oil demand over a number of years has simply been in China, and it hasn’t been happening,” Yergin said.
“The big question is, stimulus, will you see a recovery in China,” he said. “That’s what the market is struggling with.”