Oil steady amid interest rate concerns, supply cut signals ‎

Oil prices witnessed little change today, Friday, while heading for weekly gains, as fears of raising US interest rates, which could reduce energy demand, were met with indications of a contraction in supply, after a larger-than-expected decline in US crude stocks.

By 0006 GMT, Brent crude futures fell one cent to $76.51 a barrel, while US West Texas Intermediate crude rose two years to $71.82 a barrel.

According to Reuters, the two benchmarks are expected to rise about 2 percent for the second week in a row

On Thursday, the US Energy Information Administration said that US crude inventories fell more than expected, while gasoline stocks recorded a significant decline after an increase in driving rates last week.

This comes as Saudi Arabia and Russia announced a new round of production cuts for the month of August. The total cuts now exceed five million barrels per day, equivalent to five percent of global oil production

However, expectations that the Federal Reserve (the US central bank) will raise interest rates at its meeting on July 25-26 curbed oil prices.

Data on Thursday showed that the number of Americans filing new applications for unemployment benefits increased moderately last week, while the number of private sector jobs jumped in June, raising the possibility of a Federal Reserve rate hike this month. ,

Higher interest rates increase borrowing costs for businesses and consumers, which can slow economic growth and reduce demand for oil.

Sources close to OPEC said that the organization is likely to maintain its optimistic view of oil demand growth next year when it publishes its first forecast for 2024 this month, as it will expect a slowdown compared to the current year, but the increase will remain above average.