Oil prices tumbled on Friday morning, preparing to finish out the week $3 per barrel less than last Friday’s level. It is the largest weekly drop since June.
U.S. oil futures were already at their lowest point since July on Wednesday.
At 11:00 am EDT, the WTI spot price was $40.26 (-2.68%), nearly $3 under last week’s level. Brent crude was trading $43.04 (-2.34%), roughly $2 per barrel less than last week.
The fall can likely be attributed to the strong dollar, after earlier reports that the U.S. unemployment rate dropped to 8.4%--as well as reports of faltering domestic gasoline demand in the United States. A strong dollar makes U.S. oil more costly for other countries to purchase, and therefore typically has an inverse relationship with crude.
The drop comes despite a significant draw in crude oil inventories this week, but the hurricane-related nature of the draws dampened the enthusiasm for the inventory draw.
The price drop comes on the same day that Russia’s energy minister Alexander Novak predicted that oil prices would stay in the $50-$55 per barrel range next year, as the world continues to grapple with the pandemic and as an emphasis on renewables factors more into the energy landscape.
WTI futures for October were trading down $1.25 on Friday, at $40.12.
Further dents to crude oil demand are expected over the next month, as the driving season comes to a close and refinery maintenance season fast approaches.