LONDON – Brent crude oil futures fell 1.5% on Friday to settle at $65.8 per barrel, as traders closely monitored the developing geopolitical landscape and absorbed signs of weakening economic activity in China. The decline capped a volatile week, with the global oil benchmark booking a 0.5% loss overall.
Market sentiment was heavily influenced by the upcoming talks between U.S. President Donald Trump and Russian President Vladimir Putin, with hopes for a potential ceasefire in Ukraine creating uncertainty. Traders are speculating that a ceasefire could eventually lead to increased Russian oil production hitting the global market. However, any significant easing of sanctions would require U.S. Congressional approval, making a rapid increase in supply unlikely.
Adding to the downward pressure, fresh economic data from China pointed to a slowdown in the world’s second-largest economy. Factory output growth hit an eight-month low, while retail sales expanded at their slowest pace since December. This softening demand picture was further supported by a rise in Chinese oil product exports, suggesting that domestic fuel consumption is lower than anticipated, despite higher refinery throughput.
The broader market outlook remains bearish. Growing oil supplies from OPEC+ and the possibility of higher U.S. interest rates are contributing to concerns of oversupply. Overall, forecasts continue to point toward a market surplus extending through mid-2026, which is expected to keep sustained downward pressure on prices.
