Oil prices slip on weak U.S. fuel demand

Oil prices fell on Friday after U.S. inventory data reported weak fuel demand, while the U.S.-China tensions continued to weigh on the markets.

Brent crude slid 0.7%, or 25 cents, at $35.04 per barrel. U.S. West Texas Intermediate crude dropped 1.6%, or 53 cents, at $33.18 per barrel. Both benchmarks are nearing their fifth-week gains.

The U.S. Energy Information Administration’s data showed that crude oil and distillate stocks gained sharply last week. Fuel demand remained weak despite easing restrictions in many U.S. states. 

Investors will be closely watching OPEC and its allies including Russia as the organization meets in June to assess the need for additional output cuts.

Some OPEC members including de facto leader Saudi Arabia are considering extending the 9.7-million-bpd supply cut beyond June. Russia’s input on the matter is yet to be heard.

OCBC economist Howie Lee said that the market’s bullish momentum looks strong beyond the short term.