LONDON: Brent oil futures dipped towards $107 a barrel on Friday following a weaker outlook for 2014 global demand growth from the International Energy Agency and due to expectations that more Libyan crude will reach the market next week.
Brent crude was down 29 cents at $107.17 a barrel by 0927 GMT after settling 52 cents lower on Thursday.
The contract was on track to end the week about 0.5 percent higher, recouping part of the previous week's losses.
US oil was down 19 cents at $103.21 a barrel but was set to end the week about 2 percent higher.
The US oil complex was lifted by a sharp, unexpected fall in US gasoline inventories on Wednesday due to robust demand.
The spread between Brent and US crude touched $3.88 a barrel on Friday, a new low since September 2013.
Both contracts sold off after the IEA said in a monthly market report that global demand growth would average 1.29 million barrels per day (bpd) in 2014, down 60,000 bpd from its previous forecast.
This followed a similar trimming of the demand forecast by the Organization of the Petroleum Exporting Countries (OPEC) in its monthly report on Thursday to 29.65 million bpd in 2014, down 50,000 bpd from the previous estimate.
Thursday's bearish crude oil import data from China, showing March imports at a five-month low, also continued to weigh on prices. Analysts said shipments could drop further in the second quarter as refineries enter peak maintenance.
On the supply side, the market has to allow for the possibility that Libyan oil exports may pick up next week if some of its oil ports reopen.
On Thursday Libya's state National Oil Corp lifted a force majeure for the eastern port of Hariga. Analysts at JBC Energy in Vienna said in a note that this was "the strongest indication yet that a partial recovery in Libyan crude exports may be around the corner".
The country's two biggest ports, Es Sider and Ras Lanuf, remain blocked.
"If we actually see tankers leaving Libya, it could have an additional negative impact on Brent," Ole Hansen, senior commodity strategist at Saxo Bank, said.
"There have been so many false starts over the resumption of Libyan oil exports that the market is in wait-and-see mode."
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