Crude Oil Steady Below $105 After Falling From Peak

Crude oil held steady below $105 a barrel on Friday after pulling back from a 17-month peak the session before amid concerns about China`s demand growth while US jobless claims rose to the highest level in two months.

In China, the finance minister said he expects growth in the world’s second largest oil consumer to come in at 7% this year, which could weaken its demand on commodities; China`s official growth target for this year is 7.5%, which would be its slowest in 23 years.

Earlier this week exports in China recorded its biggest drop since 2009 while the industrial activity in the country continues to weaken; all this raise concerns that China might no longer be the driving force for oil demand as it has been for the last decade.

Prices also eased as the political uncertainty in Egypt, the falling US crude that show demand is rising in the world’s largest oil consumer and a weaker US dollar amid believes the Federal Reserve will keep its stimulus, pushed oil prices to multi-month highs.

- Crude is trading around $10.75 a barrel after falling $0.16

- Brent is trading around $107.70 a barrel after falling $0.03

Also weighing on prices was a report from the International Energy Agency (IEA) on Thursday saying non-OPEC supply is set to grow at the fastest pace in 20 years next year, exceeding demand and lowing the market share of OPEC countries.

In the US the jobless claims were expected to decrease instead they climbed by 16,000 last week to 360,000 enforcing beliefs that the US Federal Reserve will keep its stimulus program for a longer period of time to aid the economy.

However, upside pressures on oil prices may be seen today as the tensions in Egypt continue to escalate. Egypt’s Muslim Brotherhood plans new protests on Friday against the military’s ouster of President Mohamed Mursi and the wave of arrests to its leaders.

Oil prices next week are expected to remain on the upside if US crude stockpiles will continue to shrink while data will confirm that the Federal Reserve will maintain stimulus, pushing the US dollar even lower.

- Natural gas is trading at $3.619 per cubic feet after rising 0.17%

- Gasoline is trading at $3.0445 a gallon after rising 0.76%

- Heating oil is trading at $3.0009 a gallon after rising 0.20%