Oil falls as investors scoop up profits 

Oil falls as investors scoop up profits 

Oil prices fell on Friday, after rising to seven-year highs this week, as investors took profits following a build-up in U.S. crude and fuel inventories, though overall sentiment remained solid due to concerns over tight supply and geopolitics.

Brent crude futures were down $1.00, or 1.1%, to $87.38 a barrel by 0747 GMT. The contract earlier fell by as much as 3%, the most since Dec. 20. A day earlier the global benchmark touched $89.50 a barrel, its highest since October 2014.

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U.S. West Texas Intermediate (WTI) crude futures slid $1.16, or 1.4%, to $84.39 a barrel. The contract earlier fell as much as 3.2%, also the most since Dec. 20, after rising to its highest since October 2014 on Wednesday.

The recent rally in crude prices appeared to run out of steam on Thursday when Brent and WTI ended the trading session with slim losses, but both benchmarks have gained more than 10% this year and are headed for a fifth straight weekly gain.

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Crude stockpiles rose by 515,000 barrels last week, against industry expectations.

The EIA also reported a slight decline in refinery runs, indicating lower demand for crude.

Oil supply concerns mounted this week after Yemen’s Houthi group attacked the United Arab Emirates, OPEC’s third-largest producer, while Russia, the world’s second-largest oil producer, built up a large troop presence near Ukraine’s border, stoking fears of an invasion.

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However, the International Energy Agency (IEA) said on Wednesday that oil supply will soon overtake demand as some producers are set to pump at or above all-time highs, while demand holds up despite the spread of the Omicron coronavirus variant.

 

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