Oil prices slightly lower but head for weekly rise

Oil drilling rigs

Oil prices edged lower on Friday but are on track to post weekly gains, supported by investor optimism over China's commitments to expanding spending to boost the economy and ahead of US inventory data expected later today.

Brent crude futures for February delivery slipped slightly by 0.11% or 8 cents to $73.18 a barrel at 09:20 am KSA time.

Meanwhile, WTI crude futures for February delivery remained steady at $69.57 a barrel, following a 0.7% drop in Thursday’s session.

Brent crude is up about 0.4% for the week, while WTI is on course to record gains of approximately 0.2%.

Oil prices have faced recent pressure from a stronger US dollar but have received support from China's Ministry of Finance pledging to increase the budget deficit in the coming year to expand spending and boost domestic demand.

The World Bank has raised its forecast for China’s economic growth in 2024 to 4.9%, up from its previous estimate of 4.8% issued in June. Growth projections for 2025 were also revised upward to 4.5% from 4.1%.

Separately, investors are anticipating US oil inventory data today. Projections suggest a drop of 1.6 million barrels for the past week, following a decline of 900,000 barrels in the previous week, indicating strong demand in the world’s largest economy.