Crude Oil Prices Set for 10% Weekly Drop

WTI crude futures fell back to below $71 per barrel on Friday, the lowest in 12 months, and were on track to end the week 10% lower pressured by growing concerns about a potential global recession-driven demand downturn, particularly among advanced economies.

COVID-19 infections in China are set to surge further as some restrictions are being eased depressing economic growth in the second-largest crude oil consumer in the next few months.

On the other hand, the shutdown of the Keystone pipeline added to the highly uncertain supply outlook.

Investors are also assessing the impact of the latest sanctions on Russian oil and G7 price cap with President Putin warning that Moscow might cut oil production in response.

Meanwhile, OPEC+ decided to stick to their existing policy of reducing oil output by 2 million barrels a day from November through 2023.