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Oil slips on economic worries, but still set for strong weekly gain

Reuters  |  SINGAPORE 

By Gloystein

SINGAPORE (Reuters) - slipped on Friday amid concerns over the outlook for the global economy, but output cuts agreed by major exporters underpinned crude prices and kept markets on track for a strong weekly climb.

International Brent crude futures were at $61.55 per barrel at 0333 GMT, down 13 cents, or 0.2 percent, from their last close.

U.S. Intermediate (WTI) crude futures dropped 7 cents, or 0.1 percent, to $52.52 per barrel.

Traders said the declines came on lingering concerns over the health of the global economy.

"If we experience an economic slowdown, crude will underperform due to its correlation to growth," said Hue Frame, at in

Most analysts have downgraded their global economic growth forecasts below 3 percent for 2019, with some even fearing a looming recession amid trade disputes and spiralling debt.

For now, however, there is hope that the trade war between and may be resolved as global markets, including oil, took heart from talks between the two sides this week.

Despite Friday's price falls, Brent and WTI are set for weekly gains of more than 7 and 8 percent respectively.

Beyond global economics, markets are receiving support from supply cuts led by the Organization of the Petroleum Exporting Countries (OPEC) aimed at reining in a glut that emerged in the second-half of 2018.

A key reason for the emerging glut was the where production soared by more than 2 million barrels per day (bpd) in 2018 to a record 11.7 million bpd.

Consultancy this week said it was likely that U.S. was already "significantly above 12 million bpd" by January 2019.

Given the overall supply and demand balance, Swiss said it was "price neutral" in its

"We see the as well balanced into the foreseeable future, as the petro-nations make space for further U.S. shale production growth," said Norbert Ruecker, at the

(Reporting by Gloyystein and in Singapore; Editing by Joseph Radford)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Fri, January 11 2019. 09:12 IST