Global crude markets fell for the second straight week on supply boost after announcement of release of oil from strategic reserves by countries even as the wild gyrations in the benchmark futures were the most since the middle of 2020.
For the week, the benchmark Brent futures dropped 1.5 per cent and U.S. West Texas Intermediate (WTI) crude futures slid 1 per cent.
Brent crude settled at $102.78 a barrel and WTI futures at $98.26. For the week, Brent dropped 1.5% while WTI slid 1%. For several weeks, the benchmarks have been at their most volatile since June 2020.
International Energy Agency member countries agreed to release 60 million barrels on top of a 180 million-barrel release announced by the US last week to help drive down prices in a tight market following Russia's invasion of Ukraine.
"There's some concern that by artificially lowering prices, you are only going to increase demand and that's going to burn off that supply pretty quickly," Phil Flynn, an analyst at Price Futures Group, told Reuters.
Reuters reported that JPMorgan forecast the emergency release to "go a long way in the short term" to offsetting the missing Russian oil supply which it expects to remain permanently offline.
"However, looking forward to 2023 and beyond, global producers will likely need to ramp up investment to both fill the Russia-sized gap in supply and restock IEA strategic reserves," the bank said in a note.
European Union countries on Thursday approved a ban on Russian coal imports from August as part of new measures against Moscow, but are split over whether oil or gas sanctions should follow.