SULAIMANI (ESTA) — Oil prices edged lower lower on Friday as supply concerns eased as EU countries remained split on imposing an oil embargo on Russia while the U.S. and allies considered releasing more oil from storage to cool markets.
Brent crude futures fell 5 cents to $118.95 a barrel at 0655 GMT, after sliding 2.1% in the previous session.
U.S. West Texas Intermediate (WTI) crude futures fell 9 cents to $112.3 a barrel, having dropped 2.3% in the previous session.
Both contracts were headed for their first weekly gains in three weeks, with Brent on track for a 10% jump and WTI on course for a 7% rise amid broader fears of a supply crunch as the EU mulled a boycott of Russian oil earlier in the week.
OPEC sources said that officials believe a possible EU ban on oil from its partner Russia would hurt consumers and that the group has conveyed its concerns to Brussels, according to Reuters.
While the United States and Britain have targeted Russian oil, such an action poses a challenge for the EU, which relies on Russia for 40% of its gas.
“You’re continuing to erode inventories. That implies, on current settings, the market continues to be tight,” Reuters quoted National Australia Bank commodities analyst Baden Moore as saying.
Helping ease prices, the United States and its allies were discussing a possible further coordinated release of oil from storage, U.S. energy secretary Jennifer Granholm said on Thursday.
Separately, the United States was set to unveil a deal on Friday to supply Europe with more U.S. liquefied natural gas (LNG) for this year and next, sources familiar with the matter told Reuters.
