By Sarah Toy
Oil prices rose this week, snapping a five-week losing streak and shrugging off a downbeat U.S. inventory report, revisions lower in crude-demand growth forecasts and fresh worries about the scope of the coronavirus outbreak in China.
U.S. crude futures rose 3.4% to $52.05 a barrel this week after posting a 1.2% gain on Friday. Brent, the global gauge of prices, rose 5.2% for the week to $57.32 a barrel and climbed 1.7% on Friday.
Prices climbed even after the Energy Information Administration reported that domestic crude stockpiles rose by 7.5 million barrels last week, more than double the 2.9-million-barrel rise that analysts and traders surveyed by The Wall Street Journal had predicted.
On Thursday, the IEA slashed its oil-demand growth forecast for 2020 by 30%, or 365,000 barrels a day, citing a likely economic slowdown in China related to the coronavirus outbreak there. The day before, the Organization of the Petroleum Exporting Countries reduced its estimates for oil-demand growth by 230,000 barrels a day.
And a jump in China's daily count of new coronavirus cases has raised fresh concerns over the disease's trajectory and whether China is offering an accurate appraisal of the epidemic's reach. Fears about the virus's effect on oil demand have helped drive U.S. crude prices down around 15% so far this year.
At least some of crude's move upward this week is due to short sellers covering bets that oil prices would fall, some analysts said. Prices began to advance earlier this week following a burst of optimism about a possible slowdown in the virus's spread.
Crude's recent rise follows a sharp decline over the past several weeks that now "is being replaced by accumulation as well as short covering from speculators who have recently entered the market," Ritterbusch & Associates analysts wrote in a note.
Elsewhere in commodities, natural-gas futures rose 0.6% to $1.837 per million British thermal units on Friday. A mild winter has weighed on prices, pushing futures to their lowest level in nearly four years earlier this week.
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