Oil prices largely unchanged; set for August losses

Oil prices steadied Friday amid persistent concerns over tighter supplies in Libya and Iraq, but were still nursing losses for August as traders feared a looming slowdown in demand. 

At 08:55 ET (12:55 GMT), Brent oil futures fell 0.1% to $78.78 a barrel, while West Texas Intermediate crude futures fell 0.1% to $75.77 a barrel. 

Crude prices rebounded from recent losses this week as a production shutdown in Libya, coupled with reports of planned Iraqi production cuts, presented a tighter outlook for supplies. 

Signs of U.S. economic resilience also aided prices, as did persistent bets on interest rate cuts.

PCE price index data- the Fed’s preferred inflation gauge- remained unchanged in July, defying expectations for a small rise, largely cementing a cut of interest rates by the Federal Reserve in September.

Positive GDP data released on Thursday also showed U.S. economic growth remained much stronger than initially estimated in the second quarter. Oil prices still set for August losses 

Both contracts were still down between around 2% in August, having sunk to seven-month lows earlier in August as increased fears of a global economic slowdown battered the outlook for demand.

OPEC cut its forecast for global oil demand growth in 2024, citing weaker than expected data for the first half of the year and lower expectations for demand from China.

While these fears mostly eased through the month, concerns over slowing demand still lingered, especially amid few positive cues from top importer China.  Iraq production cuts, Libya shutdown underpin oil 

Oil prices have been supported this week after Reuters reported that Iraq planned to reduce its oil production in September as part of a plan with the Organization of Petroleum Exporting Countries.

Iraq will cut output to between 3.85 million and 3.9 million barrels per day, after producing about 4.25 million bpd in July.

Production disruptions in Libya also persisted, with reports showing over half of the country’s oil output was taken offline this week amid a growing row over the leadership of the country’s central bank.

(Ambar Warrick contributed to this article.)

Source: Investing.com