By Adedapo Adesanya
Oil prices traded down sharply on Friday after it earlier looked like they might be heading for their biggest weekly gain since the beginning of July, no thanks to a huge U.S. inventory draw, a hurricane approaching Florida, and somewhat softened U.S. vs China trade war rhetoric.
At 2 p.m. (Nigerian Time) on Friday, WTI Crude was down 0.78 percent at $56.27 and the Brent Crude was trading down 0.55 percent at $60.16 and by 10 p.m, prices slipped further into bear territory as analysts slash price forecasts citing the ongoing trade dispute between China and the United States.
Brent was trading at $59.10 dropping $1.39 equivalent to 2.3 percent while the WTI, which was set to finish higher for week lost $1.55 or 2.73 percent to trade at $55.16.
China and the United States traded tariff and counter-tariff announcements last week with Beijing saying first that China would place tariffs on a range of U.S. products worth US$75 billion, including crude oil, in two batches starting on September 1 and on December 15.
U.S. President Donald Trump retaliated with announcements of higher tariffs on Chinese products. The escalation in the dispute sent oil prices tumbling last week, and triggered new forecasts.
Oil prices continue to be capped by concerns over global economic growth and oil demand growth, but a huge draw in U.S. oil inventories lifted the price of oil in the middle of the week.
The Energy Information Administration (EIA) reported on Wednesday a 10-million-barrel draw in crude oil inventories, following the American Petroleum Institute’s estimate of an 11.1-million-barrel draw in inventories, released on Tuesday. The estimate pushed WTI Crude to the biggest intraday gains in two weeks.
Dipo Olowookere