Oil rose below $74 a barrel on Friday, but is on track to end the week flat after rebounding from a sharp drop on Monday, buoyed by expectations that supply will remain tight as demand recovers.
Oil prices and other risky assets fell at the beginning of the week due to concerns about the impact on the economy and demand from the increased cases of the mutated delta strain of Covid-19 in the United States, Britain, Japan and elsewhere.Brent crude fell 11 cents, or 0.2%, to $73.68 a barrel, after jumping 2.2% on Thursday.
US West Texas Intermediate crude fell 18 cents, or 0.3%, to $71.73 a barrel, after rising 2.3% yesterday.
On a weekly basis, Brent crude is set to end the week stable after falling in the previous three weeks.
US crude is also expected to remain stable during the week.
Both contracts fell by about seven percent on Monday, but they made up for all those losses, with investors expecting demand to remain strong and the market receiving support from falling oil stocks and high rates of vaccinations.
Demand growth is expected to exceed supply after an agreement on Sunday between the Organization of the Petroleum Exporting Countries and its allies, within the framework of the OPEC + group, to return 400,000 barrels per day each month, starting in August.
Analysts from ANZ Research said in a report that the market is beginning to feel that the 400,000 barrels per day increase will not be enough to keep the market balanced, and that stocks in the United States and in the OECD countries are declining.