(MENAFN) Oil prices witnessed their most substantial weekly decline in three months following weaker-than-expected job growth figures in the United States. Concerns among investors have arisen regarding the potential impact of sustained high borrowing costs on US economic growth, particularly considering the country's status as the world's largest oil consumer. These concerns were exacerbated after the US Federal Reserve opted to maintain interest rates at their current levels during its recent meeting.
The week saw Brent crude experiencing a decline of over seven percent, while WTI (West Texas Intermediate) recorded a drop of 6.8 percent. On Friday, Brent crude futures for July delivery settled at USD82.96 per barrel, marking a decrease of 71 cents or 0.85 percent. Similarly, US WTI crude for June delivery settled at USD78.11 per barrel, registering a decline of 84 cents or 1.06 percent.
The decline in oil prices on Friday was influenced by the release of data indicating a slower-than-expected growth in US job numbers for April, accompanied by a decrease in annual wage increases. This development has led traders to speculate that the US Federal Reserve may implement its first interest rate cut of the year as early as September.
Tim Snyder, an economist at Matador Economics, commented on the situation, noting that while the economy is experiencing a slight deceleration, the data provides a pathway for the Federal Reserve to potentially enact at least one rate cut within the year. This sentiment reflects the market's response to the evolving economic landscape and its anticipation of potential policy adjustments by central banks in response to prevailing economic conditions.
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