Oil Prices End 3% Lower on Friday s Risk-Off Sentiment Prevails

Crude oil prices fell sharply on Friday, registering a significant loss of over 3%, as concerns about the health of the global economy outweighed renewed worries about lower Q3 supplies. Benchmark US crude oil for August delivery dropped by $2.70 to settle at $80.13 per barrel. Meanwhile, Brent crude for September delivery decreased by $2.50, closing at $82.63/barrel.

WTI Crude Oil Chart Daily – The Decline Stalled at the 200 SMA

Oil Prices Show Volatility Amid Market Trends

Oil prices saw a significant rise in June but have since weakened in July. Despite the drop, moving averages have held firm. Brent oil futures and US West Texas Intermediate (WTI) crude oil experienced a rise supported by several factors: geopolitical tensions in the Middle East, a weakening dollar, expectations of US interest rate cuts, and robust crude demand during the busy summer travel season. These elements significantly boosted oil markets.

Market De-Risking and Oil Price Decline

However, these supportive factors are not currently aiding oil prices as markets enter a de-risking phase. The decrease in EIA inventory this week briefly halted the decline, resulting in a $2 rise in WTI crude oil on Wednesday. Despite this, Thursday’s doji candlestick suggested a bearish reversal, leading to a 3% drop in WTI prices yesterday, falling below $79.

July Decline As Global Landscape Deteriorate

In June, oil prices increased by more than $10, peaking at $84. However, they reversed course in early July, dropping below $80 this week. Friday’s market movements suggest a potential bearish trend in oil prices as the global economy faces challenges.

WTI Crude Oil Live Chart