LONDON: Oil prices were broadly stable on Friday and were set for a second week of declines as concern over oil demand growth outweighed Saudi output cuts.
Brent crude futures dipped 18 cents, or 0.3%, to $75.78 a barrel by 1334 GMT, while U.S. West Texas Intermediate crude was down 27 cents, or 0.4%, at $71.02.
Both benchmarks lost about $1 on Thursday, having rebounded from a slump of more than $3 after the U.S. and Iran denied a report by the Middle East Eye that they were close to a nuclear deal that could have brought Iranian barrels back to the market.
Oil prices had risen early in the week, buoyed by Saudi Arabia’s pledge over the weekend to cut output, but pared gains on a rise in U.S. fuel stocks and weak Chinese export data.
“Attention will now shift back to the precarious state of the oil demand picture,” said PVM analyst Stephen Brennock.
Expectations of tighter supply and higher demand as the United States enters the summer holiday season, when more people drive, are being offset by worries over a slow pickup in China’s fuel demand.
China’s factory gate prices fell at the fastest pace in seven years in May and quicker than forecasts, as faltering demand weighed on a slowing manufacturing sector and cast a cloud over the fragile economic recovery.
Meanwhile, strong factory activity in India - the world’s third-largest oil consumer - helped to lift fuel consumption in May, driving diesel sales to a record high.
Some analysts expect oil prices to rise if the U.S. Federal Reserve skips a interest rate hike at its next meeting over June 13-14.
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