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Brent crude futures dipped 22 cents, or 0.25%, to $87.21 a
barrel by 1105 GMT. U.S. West Texas Intermediate (WTI) crude
futures were down 9 cents, or 0.11%, at $83.79.
With the U.S. market shut on Thursday for the Independence Day
holiday, trading was thin and there was no settlement for WTI,
but prices have risen this week on strong summer demand
expectations in the United States.
"Those who have kept faith that the driving season would
eventually come are glowing in prescience and the many calls of
a much better path for bulls in the third quarter seem to hold
true at present," said PVM oil analyst John Evans.
The U.S. Energy Information Administration (EIA) reported a huge
12.2 million barrel inventories draw last week, compared with
analyst expectations for a draw of 700,000 barrels. [EIA/S]
U.S. data on Wednesday showed that first-time applications for
unemployment benefits increased last week while jobless numbers
also rose, which analysts said could hasten interest rate cuts
by the Federal Reserves and support oil markets.
On the supply side, Reuters reported on Thursday that Russian
oil producers Rosneft and Lukoil will make sharp cuts to oil
exports from the Black Sea port of Novorossiisk in July.
"This is a positive signal for the forecast supply deficit over
third quarter, but given Russia's poor adherence to production
quotas in the past, it will take some time to see if this will
be delivered," said Panmure Liberum analyst Ashley Kelty.
Russian gasoline production is expected to rise by between
15,000 and 20,000 metric tons in the last third of July as two
refineries restart operations, the energy ministry said on
Friday.
Meanwhile, Saudi Arabia's Saudi Aramco has cut prices for the
flagship Arab Light crude it will sell to Asia in August to
$1.80 a barrel above the Oman/Dubai average, underscoring
pressure faced by OPEC producers as non-OPEC supply grows.
Traders were also tracking the war in Gaza and elections in
France and Britain, analysts said.
Britain's Labour Party was set for a landslide victory after 14
years of Conservative rule.
(Reporting by Arunima Kumar in Bengaluru and Sudarshan Varadhan
in SingaporeEditing by David Goodman)
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