Oil prices extended their decline for a third straight session on Friday as the US pushed for a Russia-Ukraine peace deal that could bring more oil supplies onto the global market, while uncertainty over US interest rate cuts curbed investor risk appetite.
Brent crude futures fell 71 cents, or 1.12 per cent, to $62.67 a barrel by 0212 GMT after slipping 0.2 per cent in the previous session. US West Texas Intermediate crude was at $58.29 a barrel, down 71 cents, or 1.20 per cent, after closing 0.5 per cent lower on Thursday.
Both contracts are set to fall more than 2 per cent this week on oversupply concerns.
Market sentiment turned bearish this week as Washington pushed for a peace plan between Ukraine and Russia to end the three-year war, even as sanctions on top Russian oil producers Rosneft and Lukoil are supposed to come into effect on Friday. Lukoil has until December 13 to sell its huge international portfolio.
“With Ukraine yet to formally reject the deal, the slim odds of an agreement are weighing on prices, as it would remove much of the war’s geopolitical risk premium baked into crude,” IG market analyst Tony Sycamore said in a note.
A stronger greenback was also depressing oil prices as it makes the commodity more expensive for holders of other currencies.
The dollar was on track for its best week in over a month on Friday as investors wagered the Federal Reserve is unlikely to cut rates next month.
