Benchmark oil prices inched up on Friday but were heading for a weekly loss, pulled down by worries about a global economic slowdown, although OPEC-led supply cuts and U.S. sanctions against Venezuela provided crude with some support.
Weighing on financial markets were concerns that a trade dispute between the United States and China would remain unresolved, denting global economic prospects.
International Brent crude futures had erased earlier losses by 1422 GMT, gaining 59 cents to $62.22 per barrel. On the week, they were set for a loss of around 0.8 percent.
U.S. West Texas Intermediate crude futures also turned from red to black at $52.89 per barrel, up 25 cents and looking at a 4.2 percent weekly slump, their steepest this year.
U.S. President Donald Trump said on Thursday that he did not plan to meet Chinese President Xi Jinping before a March 1 deadline set by the two countries to strike a trade deal.
Adding to demand concerns, the European Commission sharply cut its forecasts for euro zone economic growth due to global trade tensions and an array of domestic challenges.
Another factor weighing on oil prices this week was a strong dollar.
Supply cuts led by the Organization of the Petroleum Exporting Countries lent support. OPEC kingpin Saudi Arabia reduced its output in January by about 400,000 barrels per day (bpd) to 10.24 million bpd, OPEC sources said.
Another risk to supply comes from Venezuela after the implementation of U.S. sanctions against the OPEC member’s petroleum industry in late January. Analysts expect this move to knock out 300,000-500,000 bpd of exports.
For the time being, though, the sanctions impact on international oil markets has been limited.
Libya’s National Oil Corp said on Friday that its largest oilfield, out of action since December, would remain offline until security had been restored.
“The oil demand side of the coin is facing a number of headwinds … Venezuela’s oil woes are largely priced in and there is no guarantee that the OPEC+ supply pact will be extended,” PVM analysts wrote.
“This is hardly a recipe for a sustained bout of upward buying pressures. There is, however, one potential lifeline for those of a bullish disposition. The rumor mill is in full swing that the Trump administration will not renew waivers to sanctions against buying Iranian oil.”