Oil Prices Dropped On Friday

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Oil Prices Dropped On Friday

Oil Prices Dropped By $1 On Friday, Outlook Remains Mixed

The best way to describe the price action seen in the Brent and crude oil futures is 'sea-saw.' The price of the oil futures moved up and higher only to close the day with a -$1 change. This rangebound movement in the oil market was due to the mixed signals from different sources.

The WTI futures lost 15 cents, while the Brent futures declined by 6 cents. As a result, the last trading price of WTI was $71.43, while the Brent future was trading near $76.55.

Weakness In The US Economy

The decline in the oil market on Friday took place when the data showed that the new orders continued to decline. This means the oil demand will remain weak in one of the biggest economies of the world. That's why it wouldn't be wrong to say that the below forecast results of NY manufacturing lead to a decline in oil markets.

One particular thing noted during the recent days is that the oil market has become very sensitive to every little deadline. This signifies the belief that the oil market has yet to find a bottom.

Another development that is preventing the oil from turning higher is John Williams' comments. To put it short, Williams has put the rumors of early rate cuts to rest.

This means that the oil will likely stay under pressure as high-interest rates will continue to put a drag on the US economy. This will directly lead to a weak demand in both the manufacturing and the services sector.

Besides a weaker oil market, the US Dollar is now also sitting at a 4-month low, which suggests that the year 2024 isn't going to be exactly calm for the financial markets.

In 2024, the key drivers behind the oil markets will be the decisions taken by the OPEC and the OPEC+ member countries. Any decisions to deepen the oil supply cuts will likely correct the supply and demand imbalance.

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