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Picture: UNSPLASH/IAN SIMMONDS
Picture: UNSPLASH/IAN SIMMONDS

Oil prices were little changed on Friday but headed for a weekly decline after US President Donald Trump issued a sweeping plan to boost US production and demanded Opec lower crude prices.

Brent crude futures were down 9c at $78.20 a barrel by 4.45am GMT on Friday, while US West Texas Intermediate crude (WTI) dipped 9c to $74.53. For the week, Brent was down 3.18% so far, while WTI shed 4.28%.

“Crude prices have been easing all through this week, as investors trimmed war premiums after the Gaza ceasefire while bracing for Trump’s energy policy change,” said Priyanka Sachdeva, senior market analyst at Phillip Nova.

“For now, Trump is being unpredictable as predicted, setting oil prices up for headlines-orientated volatility ahead,” Sachdeva said.

Trump, during his speech on Thursday at the World Economic Forum (WEF) in Davos, Switzerland, said he would demand that oil cartel Opec and its de facto leader, Saudi Arabia, bring down the cost of crude barrels.

He also said he would ask Riyadh to increase a US investment package to $1-trillion, up from $600bn reported by the Saudi state news agency earlier in the day.

Trump had declared a national energy emergency on Monday, rolling back environmental restrictions on energy infrastructure as part of a sweeping plan to maximise domestic oil and gas production.

On Wednesday, he vowed to hit the EU with tariffs and impose 25% tariffs against Canada and Mexico, and said his administration was considering a 10% punitive duty on China.

As attention shifts to a possible February timeline for new tariffs set by Trump, caution would probably persist in the market as any new trade restrictions would carry negative implications for global growth, potentially weighing on oil demand prospects, said Yeap Jun Rong, market strategist at IG.

Traders expected oil prices to range between $76.50 and $78 a barrel, Yeap said.

While bullish catalysts like a significant drawdown in US crude stocks are providing temporary positive swings, an overall oversupplied global market and ailing projections of Chinese demand continue to weigh on crude futures, Sachdeva said.

US crude inventories last week hit their lowest level since March 2022, according to the US Energy Information Administration.

The EIA report, issued a day late because of a US holiday on Monday, said crude stockpiles fell by 1-million barrels to 411.7-million barrels in the week to January 17, marking a ninth consecutive weekly decline.

Reuters

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