Markets

For the week ending Aug. 5, the ongoing tug-of-war between limited supply and concerns that demand will weaken—which has largely driven the market for several weeks—shifted back to the bearish side.

Concerns about poor demand amid the possibility of a slowdown in economic growth persist but oil supplies remain tight.

The petroleum market continued to be more swayed by the possibility of a worldwide recession than by currently-tight supplies over the week ending July 15.

The ongoing story of traders shifting focus between fears of a global recession and concerns about current supply tightness leaned to the bearish side over the week ending July 8.

The bears and bulls played tug-of-war throughout the week as traders shifted focus between ongoing concerns about aggressive fiscal policy causing an economic slowdown and ongoing concerns about tight supplies, with little indication that upstream output might increase any time soon.

NYMEX WTI and DME Oman futures prices lost ground over the week ending June 24 while ICE Brent was flat from the previous Friday as tightness on the supply side was overshadowed by concerns that a global recession could lead to demand destruction.

Crude futures prices were pulled down by concerns that aggressive fiscal tightening by central banks in the US, the UK, and Switzerland could lead to recessions in parts of the world.

Persistent projections that upstream producers as well as refiners will be unable to increase output rapidly enough to meet rising demand helped to push prices higher.

EU leaders finally hammered out an agreement to ban large volumes of Russian oil imports after weeks of negotiations.

The debate in Europe continued over how to get all EU member nations to agree to a bloc-wide ban on Russian oil imports, but sources indicated that the concerned parties were closing in on a deal during the week ending May 27.