Oil eased lower as a brief outage on North America’s Keystone pipeline failed to shake prices out of the tightest weekly trading range in years.
West Texas Intermediate fell 1.2% to settle near $78, further retreating from the key psychological level of $80 a barrel. Meanwhile, pipeline operator TC Energy Corp. confirmed Keystone’s integrity, adding that service was temporarily suspended “as a precautionary measure” and that no crude was released.
Oil has traded in a tight band this year, with even less volatility this week, confining Brent prices to their narrowest range since September 2021. Cutbacks by OPEC+ and rising tensions in the Middle East and Red Sea have been balanced by surging supply from producers outside the cartel including the US. Persistent concerns about China’s growth have added to headwinds.
Still, crude is getting support from Federal Reserve Chair Jerome Powell’s comments that the central bank is getting close to the confidence it needs to start lowering interest rates. The dovish news pushed the dollar to its sixth session of declines, bolstering commodities priced in the currency. Meanwhile, China’s oil demand has entered a low-growth phase as the nation shifts away from fossil fuels, the country’s biggest energy producer said.
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