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Central banks are raising interest rates to tame inflation,
spurring fears that rising borrowing costs could stifle growth,
while mass COVID-19 testing in Shanghai this week stoked fears
of potential lockdowns that could also hit oil demand.
Brent crude rose 35 cents, or 0.3%, to $105.00 a barrel by 1045
GMT and U.S. West Texas Intermediate crude gained 19 cents, or
0.2%, to $102.92.
Both benchmarks were set to register weekly declines, following
on from the first monthly decline since November. Prices had
tumbled on Tuesday, when Brent's $10.73 drop was the contract's
third-biggest fall since it started trading in 1988.
"With more rate hikes to come and the U.S. likely in a technical
recession, top-side market ambitions could be quite limited,"
Stephen Innes, managing director at SPI Asset Management, told
Reuters.
In focus on Friday will be the latest U.S. jobs data, which is
expected to show that non-farm payrolls increased by 268,000 in
June.
However, oil prices have soared over the first half of the year.
Brent crude came close to the record high of $147 after Russia
launched its invasion of Ukraine in February, adding to supply
concerns that some analysts expect to worsen.
"Economic worries may have roiled oil prices this week, but the
market is still flashing bullish signals. This is because supply
tightness is more likely to intensify from this point than to
ease," said Stephen Brennock of oil broker PVM.
Western bans on Russian oil exports have kept prices supported
and sparked a re-routing of flows while the Organization of the
Petroleum Exporting Countries (OPEC) and its allies are
struggling to deliver on pledged production increases.
(Reporting by Alex LawlerAdditional reporting by Florence Tan
and Jeslyn LerhEditing by David Goodman)
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