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LONDON: Oil prices were little changed on Friday and heading for a weekly gain, as investors weighed the impact of further tariffs and sanctions by US President Donald Trump.
Brent crude futures were up 19 cents, or 0.26 percent, to $71.89 a barrel at 11:23 a.m. Saudi time. US West Texas Intermediate crude was up 20 cents, or 0.29 percent, to $69.46 a barrel.
Prices stabilized on Friday after losing more than 1 percent in the previous session. However, for the week Brent was on course for a 5 percent gain, and WTI around 6.6 percent.
Investors have focused on the potential impact of US tariffs on oil prices this week, as tariff rates on US trading partners are set to go into effect from August 1.
Trump signed an executive order on Thursday imposing tariffs ranging from 10 percent to 41 percent on US imports from dozens of countries and foreign territories including Canada, India and Taiwan that failed to reach trade deals by his August 1 deadline.
Partners that managed to secure trade deals include the European Union, South Korea, Japan and Britain.
“We think the resolution of trade deals to the satisfaction of the market – more or less, barring a few exceptions – has been the key driver for oil price bullishness in recent days, and further progress on trade talks with China in future could be a further confidence booster for the oil market,” said Suvro Sarkar, energy sector team lead at DBS bank.
Prices were also supported this week after Trump threatened to impose 100 percent secondary tariffs on Russian crude buyers in a bid to pressure Russia into halting its war against Ukraine, stoking concerns of potential disruption to oil trade flows and the removal of some oil from the market.
JP Morgan analysts said in a note on Thursday that Trump’s warnings to China and India of penalties on their ongoing purchases of Russian oil potentially put 2.75 million barrels per day of Russian seaborne oil exports at risk. The two countries are the world’s second- and third-largest crude consumers, respectively.
However, some analysts remain concerned that US levies will limit economic growth by raising prices, which could weigh on oil demand.
On Thursday, there were signs that existing tariffs are already pushing prices higher in the US, the world’s biggest economy and oil consumer, inflation data for June showed.