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LONDON (Reuters) – Oil prices were put under pressure on Friday by trade tensions between the United States and China and were on track for a third consecutive week of decline.
An oil tanker crosses the Singapore Strait on July 7, 2014. To match USA-OIL / ASIA-BP REUTERS / Tim Wimborne / Photo File
Brent oil dropped 14 cents to $ 72.44 a barrel around 1050 GMT. US crude West Texas Intermediate (WTI), which was due for delivery in August, was up 8 cents to 69.54 dollars a barrel, while the September contract fell 18 cents to 68.08 dollars.
U.S. President Donald Trump said in an interview with CNBC that he was ready to apply tariffs on $ 500 billion worth of goods imported from China.
The decline in oil demand in the United States and China caused by an economic slowdown caused by their trade dispute would probably weigh heavily on the markets.
The People 's Bank of China (PBOC) on Friday reduced its mid – point of the yuan for the seventh consecutive trading day to the year' s low.
The yuan then retreated to a low of nearly 13 months, although it rebounded later in the day.
Trump also said that he was concerned that the Chinese currency "was falling like a rock" and that the strong US dollar "puts us at a disadvantage".
The United States accounted for about one fifth of global oil demand in 2017, while China consumed about 13%, according to the BP Statistical Review of Energy.
A group of Norwegian drilling workers on Thursday agreed to end a strike that began on July 10, removing a threat to oil and gas production in the region.
But prices found some support after OPEC's largest oil producer announced that it was going to temper its exports next month.
Saudi Arabia expects its exports to drop by about 100,000 barrels per day in August to ensure that it does not introduce more than oil on the market that customers need, said the governor of OPEC, Adeeb Al-Aama.
"Although international oil markets are well balanced in the third quarter, there will still be large stocks due to strong demand and seasonal factors in the second half," Al-Aama said in a statement.
He also stated that the concerns that Saudi Arabia and its partners are dramatically overfilling the market are "baseless".
Additional report by Aaron Sheldrick in Tokyo; Edited by Adrian Croft
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