Crude oil prices fluctuate as traders follow G-7 news

Oil hovered above $107 a barrel as investors followed the G7 leaders’ meeting while fears of a recession still linger.

West Texas Intermediate futures ended up 3.2% on Friday, but posted their first consecutive weekly losses since April. The G7 is committed to supporting Ukraine in its defense against Russian invasion, the text of the draft statement says. The group also weighs the country’s oil price cap.

Oil could fall for the first time since November as fears escalate over a global slowdown as central banks raise interest rates to fight rising inflation. However, retail prices for gasoline are not falling as fast as for oil, due to a lack of fuel production capacity.

Oil came under pressure on fears of an economic slowdown, said Gao Jian, an analyst at Zhaojin Futures Co in Shandong. However, fundamental factors will limit the decline in oil prices, he added.

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The oil market is showing optimistic signs, despite the fact that the recent turmoil has gripped it along with other commodities. Global oil and fuel supplies remain tight, exacerbated by Russia’s incursion into Ukraine, and futures contract timing signals tight supply.

Discussions between G-7 leaders and officials about a maximum price for Russian oil are ongoing, and an agreement has yet to be reached, analysts say. A potential mechanism would work, they said, by imposing restrictions on insurance and shipping.

The US and Iran will resume talks to restart the nuclear deal as soon as possible, European Union chief diplomat Josep Borrell said Saturday during a press conference in Tehran with his Iranian counterpart. The talks will be mediated by the EU and will take place in the Persian Gulf country, Iranian media reported.

The market was stripped of its weekly U.S. stocks and demand survey last week after power outages delayed the release of Energy Information Administration data. The agency needs to replace damaged equipment and expects to provide an update on the situation on Monday.