• Friday, February 23, 2024
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Brent oil holds above $98, heads for worst week in 6 on weak demand

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Brent crude held above 98 dollars a barrel on Friday as concerns over weak demand outweighed geopolitical worries in the Middle East and Ukraine.

Weaker oil demand in China and Europe had caused growth in global oil demand to soften at a remarkable pace, the International Energy Agency said.

The West’s energy watchdog cut its demand growth projections by 150,000 barrels per day (bpd) to 900,000 bpd for 2014 and by 100,000 bpd to 1.2 million bpd in 2015.

Brent is down three per cent for the week so far, headed for its biggest weekly loss since the week to August 1.

The October contract had fallen a cent to 98.07 dollars after a four-cent gain in the previous session.

Brent bounced from a two-year low on Thursday after Russia warned the U.S. over air strikes in Syria against Islamist militants.

Russia said such act would be an act of aggression without a U.N. security mandate.

This raised the spectre of a new confrontation between Moscow and the West.

“I would like to see more risk premium priced in, but the market doesn’t want to,” said Michael McCarthy, chief market strategist at CMC Markets in Sydney.

“There are still a lot of potential concerns, but the market seems relaxed by it all.”

Geopolitical worries included Russia, which is facing fresh sanctions from the European Union and the U.S. over the Ukraine crisis, McCarthy said.

The EU implemented tougher sanctions against Russia on Friday, which targeted some state-owned companies and individuals.

(Reuters/NAN)