By Adedapo Adesanya
The price of the international crude benchmark oil, Brent Crude, settled higher by 61 cents or 0.74 per cent to $83.47 per barrel on Friday as geopolitical tensions in the Middle East more than offset a forecast for slowing demand.
Also, the US West Texas Intermediate (WTI) crude grew by $1.16 or 1.49 per cent to $79.19 per barrel, with Brent gaining more than 1 per cent in the week and the US crude grade expanding by about 3 per cent on a week-on-week basis.
The growing risk of a wider conflict in the Middle East supported crude prices, as Hezbollah fired dozens of rockets at a northern Israeli town in response to the killing of 10 civilians in southern Lebanon, the deadliest day for Lebanese civilians in four months of cross-border hostilities.
In Gaza, Israel attacked the largest functioning hospital in the ongoing war with Islamist group Hamas, as warplanes struck Rafah, the last refuge for Palestinians in the enclave.
Also, threats persisted in the Red Sea after a missile fired from Yemen struck an India-bound tanker carrying crude oil.
Yemen’s Iran-backed Houthis have said they will press on with attacks on Red Sea shipping in solidarity with the Palestinians, as long as Israel continues to commit crimes against them.
The attacks on ships have disrupted global commerce, stoked fears of inflation and deepened concern the Israel-Hamas war could spread.
The continued tension in the region pushed demand worries to the back after the International Energy Agency (IEA) said global oil demand growth was losing momentum and trimmed its 2024 growth forecast.
The agency expects global oil demand growth to decelerate to 1.22 million barrels per day in 2024, about half of the growth seen last year, in part due to a sharp slowdown in Chinese consumption. It had previously forecast 2024 demand growth of 1.24 million barrels per day.
Meanwhile, the Organisation of the Petroleum Exporting Countries (OPEC) expects oil use to keep rising for the next two decades.
Positive US data kept also shaping expectations in the largest oil producer as US producer prices increased more than expected in January amid strong gains in the costs of services, which could amplify inflation worries.
However, a slump in retail sales prompted hopes the US Federal Reserve will soon start cutting rates, which could support oil demand.
US energy firms this week cut the number of oil and natural gas rigs in operation for the second time in three weeks, energy services firm Baker Hughes said.
Modupe Gbadeyanka