Oil futures were mixed Friday, and remained on track for a second consecutive weekly loss as worries over the outlook for demand continued to weigh.
West Texas Intermediate crude for October delivery
rose 11 cents, or 0.3%, to $37.41 a barrel on the New York Mercantile Exchange, while November Brent
the global benchmark, fell 6 cents, or 0.2%, to $40 a barrel on ICE Futures Europe. Both benchmarks were on track for weekly declines of more than 6%.
Crude struggled Thursday as investors focused on government data that showed U.S. oil inventories rose for the first time in seven weeks. The end of U.S. driving season, which runs from Memorial Day to Labor Day, has heightened worries over near-term domestic demand, while uncertainty also lingers over the outlook for global demand as COVID-19 cases continue to rise.
“Higher crude prices amidst weak product demand this summer inadvertently crushed refining margins that resulted in economic run cuts,” leaving U.S. refinery runs around 2.7 million barrels a day below normal levels,” said Michael Tran, analyst at RBC Capital Markets in a note.
A plunge by crude prices on Tuesday was accompanied by lower gasoline and distillate crack spreads — the difference between the price of crude and the products refined from it — a signal that end-user demand has been unable to absorb product balances, he said.
“To call an inflection point, we are laser focused on two indicators: The Atlantic Basin marginal barrel to tell us when buying patterns pick up, and global refining margins to indicate when demand is truly increasing,” Tran said, in a note. “Both of these indicators must turn the corner meaningfully in order for the oil market to structurally rebalance.”
October natural-gas futures
were down 0.5% at $2.311 per million British thermal units.