Oil prices were steady on Friday amid support from ongoing supply cuts led by OPEC and U.S. sanctions on Venezuela and Iran, but weighed down by concerns that an economic slowdown will soon start denting growth in fuel demand.
International benchmark Brent crude oil futures were at $67.16 per barrel at 0029 GMT, down 7 cents from their last close, but still within a dollar of the $68.14 per barrel 2019-high reached the previous day.
U.S. West Texas Intermediate (WTI) crude oil futures were at $58.53 per barrel, down 8 cents from their last settlement, and also not far off their 2019-high of $58.74 from the previous day.
Despite Friday’s dips, crude has gained around a quarter in value since the start of the year.
“Crude oil continues to grind higher … in response to ongoing production cuts from the OPEC+ group of producers as well as another (output) slump from a blacked-out Venezuela,” said Ole Hansen, head of commodity strategy at Denmark’s Saxo Bank.
The Organization of the Petroleum Exporting Countries (OPEC) and non-affiliated allies such as Russia – known as the OPEC+ alliance – has pledged to withhold 1.2 million barrels per day (bpd) in crude supply since the start of the year to tighten markets and prop up prices.
Meanwhile, a political and economic crisis in Venezuela combined with U.S. sanctions against Venezuela as well as Iran, have further tightened oil markets.
Holding crude back crude prices from rising further have been concerns that a global economic slowdown that has gripped large parts of Asia and Europe, and which is showing signs of spilling into North America, will soon dent growth in demand for oil.
“(But), worries about growth and future demand for crude oil remain just worries at this stage,” said Saxo Bank’s Hansen.
Crude oil use by China’s refineries in the first two months of 2019 rose 6.1 percent from a year earlier to a record 12.68 million bpd, official data showed this week.