Brent oil inched up on Feb. 8 but was heading for a weekly loss, pulled down by worries about a global economic slowdown, although OPEC-led supply cuts and U.S. sanctions against Venezuela provided crude with some support.
Weighing on financial markets were concerns that a trade dispute between the U.S. and China would remain unresolved, denting global economic prospects.
International Brent crude futures had erased earlier losses by 1036 GMT, gaining 12 cents to $61.75/bbl. On the week, they are set for a loss of around 1.5%.
U.S. West Texas Intermediate crude futures stood at $52.53 per barrel, down 11 cents and looking at a 5/bbl weekly slump, their steepest this year.
President Donald Trump said on Feb. 7 that he did not plan to meet Chinese President Xi Jinping before a March 1 deadline set by the two countries to strike a trade deal.
Adding to demand concerns, the European Commission sharply cut its forecasts for euro zone economic growth due to global trade tensions and an array of domestic challenges.
Another factor weighing on oil prices this week was a strong dollar.
"It seems that macro risk still prevails over constructive supply fundamentals in the oil market," Harry Tchilinguirian, global head of commodity markets strategy at BNP Paribas, told the Reuters Global Oil forum.
Supply cuts led by the Organization of the Petroleum Exporting Countries lent support. OPEC kingpin Saudi Arabia reduced its output in January by about 400,000 barrels per day (bbl/d) to 10.24 MMbbl/d, OPEC sources said.
Another risk to supply comes from Venezuela after the implementation of U.S. sanctions against the OPEC member's petroleum industry in late January. Analysts expect this move to knock out 300,000 to 500,000 bbbl/d of exports.
For the time being, though, the sanctions impact on international oil markets has been limited.
"The oil demand side of the coin is facing a number of headwinds ... Venezuela’s oil woes are largely priced in and there is no guarantee that the OPEC+ supply pact will be extended," PVM analysts wrote.
"This is hardly a recipe for a sustained bout of upward buying pressures. There is, however, one potential lifeline for those of a bullish disposition. The rumour mill is in full swing that the Trump administration will not renew waivers to sanctions against buying Iranian oil."
Oil prices rose on March 29 amid the ongoing OPEC-led supply cuts and U.S. sanctions against Iran and Venezuela, putting crude markets on track for their biggest quarterly rise since 2009.
Oil prices rose to their highest levels since November 2018 on April 8, driven up by OPEC's ongoing supply cuts and U.S. sanctions against Iran and Venezuela.
Oil prices nudged lower on April 15 after international benchmark Brent hit a fresh five-month high in the previous session, with investors eyeing mixed signals on global supply.