Oil futures fell 1.5% in volatile trading on Friday, ahead of the meeting of the Organization of the Petroleum Exporting Countries and its allies (OPEC Plus) tomorrow, Sunday, and the European Union imposing an embargo on Russian crude the day after tomorrow, Monday.
Brent crude futures fell 1.5% and settled at $85.57 a barrel.
US West Texas Intermediate crude futures also fell 1.5% to $79.98 upon settlement.
The two raw materials fluctuated between decline and rise today, but they captured their first weekly gains after falling for 3 consecutive weeks.
Brent's weekly gains were 2.5%, and US crude 5%.
It is widely expected that OPEC Plus will adhere to the policy of reducing oil production by two million barrels per day during its meeting tomorrow, but some analysts believe that crude prices may decline unless the group decides to cut further.
Two sources from major Russian producers said that Russian oil production may decline by about 500,000 to 1 million barrels per day in early 2023 due to the European Union’s ban on seaborne imports, starting from Monday.
European agreement
Poland's ambassador to the European Union, Andrzej Sadus, said Warsaw had agreed to the EU's deal for a ceiling of $60 a barrel on Russian seaborne oil, allowing the bloc to go ahead with formal approval of the agreement at the weekend.
European Commission President Ursula von der Leyen said the Russian oil price ceiling would be adjustable over time so that the union could respond to market developments.
Russia's Urals crude was sold in the $70 a barrel range on Thursday afternoon.
The cap aims to limit Russia's revenues while not leading to a rise in oil prices, according to observers.
And in what may give an impetus to oil prices, sources told Reuters that China is preparing to announce the relaxation of the rules of quarantine for Covid-19 within days, which will represent a major shift in the policy of the second largest oil consumer in the world, but analysts say that activity is likely not to resume. tangible economy only after months.
Oil prices were also boosted by the drop in the dollar index, whose performance is usually inversely proportional to oil prices, hitting its lowest level in 5 months.