Oil prices fell on Friday and are set to lose nearly 4 per cent this week as the prospect of higher interest rates, slowing global growth, and China’s COVID-19 lockdown hurt demand, even as the European Union weighs a ban on Russian oil.

Brent crude futures were down 81 cents, or 0.8 per cent, at $107.52 a barrel by 0130 GMT, while US West Texas Intermediate (WTI) crude futures were down 72 cents, or 0.7 per cent, at $107.52 a barrel. $103.07 a barrel. Weekly losses for both benchmark contracts were around 3.7 per cent.

It was a minor week of trade volatility since Russia began its invasion of Ukraine on Feb. 24, triggering sanctions, cutting Russian oil supplies, and causing consumers to release record amounts of oil from emergency stockpiles. Moscow called its operations in Ukraine “special operations”.

Worries about the conflict in Ukraine sparking inflation and weakening economic growth dominated trading in the second half of the week, with the International Monetary Fund slashing its global growth forecast by almost a percentage point.

China’s central bank governor Yi Gang said on Friday that the world’s second-largest economy is not immune to external shocks and is also under pressure from the coronavirus outbreak. Comments from Federal Reserve Chairman Jerome Powell on Thursday about aggressive interest rate hikes boosted the dollar, making oil more expensive for buyers holding other currencies, adding to the sentiment for oil. Negative emotion.

But all of this is happening in a tight-supplied market, which could be even more scarce if the EU goes ahead with its ban on Russian oil. “The worsening situation in Ukraine is increasing the pressure on EU sanctions on Russian oil,” ANZ Research analysts said.