Oil prices edged higher on Friday but was poised for the steepest weekly losses since late June on a tariff-hit economic outlook and a potential meeting between U.S. President Donald Trump and Russian counterpart Vladimir Putin.
Brent crude futures were up 52 cents, or 0.78%, at $66.95 a barrel by 1104 GMT. U.S. West Texas Intermediate crude futures rose 43 cents, or 0.67%, to $64.31.
Brent was on track to be down 3.9% over the week while WTI was set to finish 4.5% lower than last Friday’s close.
Higher U.S. tariffs against a host of trade partners went into effect on Thursday, raising concern over economic activity and demand for crude oil, ANZ Bank analysts said in a note.
The latest tariffs arrive against a backdrop of an already weaker than expected U.S. labour market and Thursday’s announcement by the Kremlin that Putin and Trump would meet in the coming days as trade tensions rise between the U.S. and Russia’s oil customers.
Trump this week threatened to increase tariffs on India if it kept buying Russian oil, which the market viewed as putting further pressure on Russia to reach a deal with the U.S., said independent analyst Tina Teng.
Trump also said China, the largest buyer of Russian crude, could be hit with tariffs similar to those levied against Indian imports.
The potential meeting raises expectations of a diplomatic end to the war in Ukraine, which could lead to eased sanctions on Russia, with Russian stocks rallying after the news.
“There could be a meeting between Trump and Putin in the near future, which could indicate that Trump is adopting a wait-and-see approach with regard to further sanctions against Russia and its allies,” Commerzbank analysts said in a note.
However, some analysts remain cautious.
“The Russian leader is expected to insist on having his territorial demands granted, a hard sell for the invaded country, while his U.S. counterpart will push for a ceasefire,” said PVM analyst Tamas Varga.
“No breakthrough is anticipated, and the U.S. following through on its threat to impose secondary sanctions on those dealing in Russian energy — including China and India — remains a possibility.”
—Robert Harvey, Reuters
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