Oil prices dropped on Friday as clouds gathered over the global economy after the European Central Bank (ECB) warned overnight of continued weakness and fresh data showed Chinese exports and imports slumped last month. With surging U.S. supply also unsettling markets, international benchmark Brent crude futures were at 65.78 dollars per barrel at 0528 GMT, down 52 cents, or 0.8 per cent from their last close.
U.S. West Texas Intermediate (WTI) crude futures were at 56.25 dollars per barrel, down 41 cents, or 0.7 per cent. Financial markets, including crude oil futures, took a hit after ECB President Mario Draghi said on Thursday the economy was in “a period of continued weakness and pervasive uncertainty”.
Europe’s economic weakness comes as growth in Asia is also slowing down. So far oil demand has held up, especially in China where imports of crude remain above 10 million barrels per day (bpd). Yet a slowdown in economic growth will at some point likely dent fuel demand, putting pressure prices.
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