Oil Falls After U.S. Jobs Data, Closing the Week with Losses of Up to 9%

Oil prices dropped after weaker-than-expected U.S. job growth in August, ending the week with steep losses as demand concerns outweighed OPEC+’s decision to delay an increase in supply.

On Friday, oil prices declined after the U.S. reported weaker job growth in August, marking a sharp weekly loss for the commodity. Concerns over demand overshadowed OPEC+’s move to postpone a planned production increase.

Brent crude futures fell by $1.63, or 2.24%, to $71.06 per barrel, while U.S. West Texas Intermediate (WTI) crude dropped $1.48, or 2.14%, to close at $67.67.

For the week, Brent lost nearly 9%, and WTI fell around 8%.

U.S. government data released on Friday showed that employment grew less than expected in August, but the unemployment rate dropped to 4.2%. This suggested an orderly slowdown in the labor market, which likely doesn’t warrant a significant rate cut from the Federal Reserve this month.

The jobs report was somewhat weak, suggesting that the U.S. economy may be entering a downturn. Demand concerns from China also continued to weigh on oil prices.

On Thursday, Brent hit its lowest level since June 2023, despite a drop in U.S. crude inventories and OPEC+’s decision to delay planned increases in oil production.

U.S. crude inventories fell by 6.9 million barrels to 418.3 million barrels last week, compared to the expected decline of 993,000 barrels, according to a Reuters survey of analysts.