Investing.com — Oil prices pared losses Friday and remain on track for a weekly gain, as a massive U.S. interest rate cut eased some fears of slowing demand.
At 1:43 PM ET (1743 GMT), the stock rose 0.01% to $74.89 per barrel, while the stock rose 0.3% to $71.39 per barrel.
Oil rises to weekly gains after cheers over interest rate cuts
Crude oil prices have staged a strong recovery from a nearly three-year low earlier in September, with much of their recovery coming this week as the dollar retreated following a Federal Reserve drop.
and WTI futures rose about 4% this week.
Geopolitical tensions rose in the Middle East, benefiting crude as Israel attacked Beirut, claiming to have killed a senior Hezbollah commander. Earlier this week, Israel reportedly detonated pagers and walkie-talkies belonging to Hezbollah members, prompting promises of retaliation. Fighting also continued in and around Gaza.
Softer rates also helped prices after the Fed cut rates at the high end of market expectations and signaled an easing cycle that traders are betting will boost economic growth in coming quarters.
Lower rates generally bode well for economic activity, which in turn is expected to boost crude oil demand.
Rig counts unchanged
The number of oil rigs operating in the US remained unchanged at 488 from a week earlier, data from energy services company Baker Hughes showed on Friday.
The unchanged rig count comes as production was recently disrupted due to the impact of Hurricane Francine.
Concerns about Chinese demand persist
But China remained a major point of contention for crude markets as economic data from the world’s largest oil importer showed little sign of improvement.
The People’s Bank of China remained unchanged on Friday despite increasing calls for Beijing to unlock more stimulus measures for the economy.
Data released earlier in September showed Chinese refinery output slowed for a fifth straight month in August, while the country’s oil imports also remained mostly weak.
Concerns about China dragged oil prices to a near three-year low earlier this month and have limited any major recovery in crude.
“China is obviously the biggest concern in terms of demand, but there are also reports that refineries in Europe are cutting production rates due to poor margins,” ING analysts said in a note.
(Peter Nurse, Ambar Warrick contributed to this article.)
