WTI crude oil futures dropped toward $68 per barrel on Friday, set for a weekly decline after three consecutive weeks of gains.
Oil set to close week down
The pullback comes amid concerns of a potential shift to an oversupplied global oil market. The International Energy Agency (IEA) forecasted an oil surplus for next year, citing slowing demand growth in China and rising global output. The surplus could worsen if OPEC+ reinstates previously halted production. Further weighing on crude prices is the stronger US dollar, which surged to a two-year high, making dollar-denominated commodities less attractive.
US inventories rise more than expected
Additionally, the latest EIA report showed a larger-than-expected increase in US crude inventories, up 2.1 million barrels compared to forecasts of a 1.9 million barrel rise. However, there was a significant drawdown in gasoline stocks, with levels falling by 4.4 million barrels, marking the lowest for this time of year in a decade.
