As concerns about limited oil supplies were eclipsed by growing worries about a global economic downturn and a stronger dollar, oil was on track to post its first quarterly loss in more than two years.
West Texas Intermediate prices, which have fallen by almost 24% this quarter, were trading close to $80 a barrel on Friday. The dollar's recent record-high rise has roiled crude as aggressive central bank rate hikes cloud the outlook for global growth.
The Organization of Petroleum Exporting Countries, which has expressed its willingness to preserve petroleum prices, is concerned about the diminishing fall. Plans for reducing supply are being discussed by OPEC+, which might stop the price decline and provide the market more direction. According to analysts at RBC Capital Markets, JPMorgan Chase & Co., and other firms, the producer group may withdraw 500,000 to 1 million barrels of supplies each day.
According to Rebecca Babin, a senior energy trader at CIBC Private Wealth Management, crude is "limping into the conclusion of the quarter." The OPEC+ meeting is the next significant event, but before then, expect bumpy trading that is sensitive to changes in the dollar.
As it works to resuscitate its economy, which has been severely impacted by Covid-19 lockdowns and a housing collapse, China has announced new crude import and fuel export limitations. After the quota was set, crude prices increased, but the massive allocation of oil products for exports reduced the earnings from processing crude into refined fuels. According to data released on Friday, factory activity in the Asian country struggled to gain traction in September as services stalled.
