Oil futures headed lower on Friday, contributing to a big weekly decline as investors shifted their focus away from tightening supplies after signs a surge toward $100 a barrel was destroying demand.
“Oil benchmarks have been forced to unwind all of last month’s gains as markets stare out into a darkening global demand outlook, fretting over the fallout from higher-for-longer rates,” especially in light of Friday’s higher-than-expected headline non-farm payrolls number, he told MarketWatch. “Oil’s downside was exposed by the surge in the dollar and yields, while the recent pullback in U.S. gasoline consumption also eroded bullish sentiment surrounding the commodity,” said Tan.Although demand-side fears have assumed control over oil benchmarks so far this month, oil prices may yet recover if “attentions are allowed to shift back on the expected market deficit,” Tan said.