By Arathy Somasekhar
(Reuters) – Oil prices held steady in early trade on Friday but were set for a third straight week of losses after markets fell dramatically on fears of a weakening US economy and slowing Chinese demand.
Brent crude was up 14 cents, or 0.2%, to $72.64 a barrel by 0002 GMT, while US West Texas Intermediate was up 17 cents, or 0.3%, to $68.73 a barrel after four straight days of losses.
For the week, Brent was expected to close 8.7% down, while WTI was expected to close 10.5% lower.
Concerns over a regional US banking crisis lingered, further unsettling markets after PacWest Bancorp said it was reviewing strategic options.
Oil prices were also weighed down by a stronger dollar after the European Central Bank hiked interest rates on Thursday, signaling the need for further tightening a day after the US Federal Reserve also hiked rates.
A stronger greenback makes crude oil more expensive for foreign currency-holding buyers.
However, investors are now broadly expecting the Fed to hold rate hikes at its June meeting after the Federal Reserve dropped a statement that it “expects” more rate hikes from its policy statement.
In China, factory activity unexpectedly slowed in April as orders fell and weak domestic demand hit the broad manufacturing sector, threatening the broader economic outlook for the second quarter.
Traders are now focused on the release of US April employment data later in the day in hopes they could help gauge the health of the economy, as well as monetary policy comments from St. Louis Fed President James Bullard and Minneapolis Fed- President Neel Kashkari at the Economic Club of Minnesota.
(Reporting by Arathy Somasekhar; Editing by Leslie Adler)
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