Oil down over weaker-than-expected US economic data

Oil prices dropped on Friday on data signaling that US economic growth is weaker than expected in the second quarter of the year amid rising COVID-19 cases worldwide.

International benchmark Brent crude was trading at $74.47 per barrel at 0712 GMT for a 0.84% decrease after closing Wednesday at $75.10 a barrel.

American benchmark West Texas Intermediate (WTI) traded at $73.25 a barrel at the same time for a 0.50% fall after ending the previous session at $73.62 per barrel.

Weaker-than-expected data is putting pressure on prices, raising concerns that the increase in the number of COVID-19 cases in many countries will negatively affect the global economic recovery and oil demand.

Despite the rise in the number of cases worldwide, expectations that increasing vaccination rates will reduce strict quarantine measures and travel restrictions are limiting further oil price declines.

The US economy showed a slight growth rate of 6.5% in the second quarter, remaining lower than the expected 8.5% rate as strong consumption was partially offset by lagging property investments and inventory drawdowns.

However, the number of Americans filing first-time unemployment claims fell by 24,000 to 400,000 last week, less than the market expectation of 380,000, according to Labor Department figures on Thursday.

Despite the decline, the unemployment rate rose to 5.9% in June from 5.8% the previous month, according to the figures.

Although the world’s largest economy added 850,000 jobs in June, it still has 9.5 million unemployed.

Source: Anadolu Agency