Crude oil prices fell on Friday as fears of slowing global growth and expectations of a US interest rate hike intensified, despite supply concerns caused by the war in Ukraine.
By 8:10 (GMT), Brent crude contracts for June delivery were trading at $107.53 a barrel, down 80 cents, or 0.74 percent.
US West Texas Intermediate crude contracts for June delivery also fell 74 cents, or 0.71 percent, to $103.05 a barrel.
The two benchmarks are heading to record weekly losses of about 4 percent each.
On Tuesday, the International Monetary Fund reduced its forecast for global economic growth to 3.6 percent in 2022 and 2023, compared to 4.4 and 3.8 percent, respectively, its previous forecasts last January, which means a drop in demand for crude oil.
And increased pressure on crude prices, hints Federal Reserve Chairman (US Central Bank) Jerome Powell to speed up raising interest rates to curb inflation.
On Thursday, Powell acknowledged that the Fed’s expectations of easing inflation had been disappointed, and said that “it is appropriate to move a little faster, and (the rate hike) will be on the table for the May meeting” of the Fed.
The Reserve Board is scheduled to hold its next meeting on May 2-3.
Powell’s comments led to the rise of the US dollar, which means an increase in the cost of dealing with oil for holders of other currencies.
On the other hand, the markets are facing a shortage of supply due to the disruption of Russian supplies after the West imposed a wide package of sanctions on Moscow in response to its military operation in Ukraine.
The European Union is considering extending these sanctions to include the Russian oil embargo.
Major countries led by the United States are seeking to compensate for the lack of Russian supplies by pumping tens of millions of barrels of oil from the reserve in the largest withdrawal from the strategic stockpile since its establishment in the mid-1970s.