Oil prices fell on Friday, with Brent crude down 50 cents (0.6%) to $80.79 per barrel and U.S. West Texas Intermediate (WTI) crude dropping 80 cents (1%) to $77.88 per barrel. Despite the daily losses, both benchmarks posted weekly gains, with Brent up 1.3% and WTI climbing 1.7%.
The market reacted to new U.S. sanctions on Russian oil producers and tankers, which tightened supply in key regions like Europe, India, and China. However, prices were pressured by expectations of reduced shipping disruptions in the Red Sea after a ceasefire agreement in Gaza, potentially halting attacks by Yemen’s Houthi militia.
Earlier in the day, prices found support from easing U.S. inflation data, bolstering hopes for interest rate cuts, and resilience in China’s economy, which achieved 5% growth in 2024. Still, China’s refinery throughput declined for the first time in over two decades, excluding pandemic years, due to sluggish demand and low margins.
Other notable factors included a two-rig drop in the U.S. oil rig count, bringing the total to 478, and forecasts of freezing Arctic weather in the U.S., which could drive heating oil demand and impact production operations.