U.S. crude oil rises above $74 per barrel but posts weekly loss on slowing China demand

U.S. crude oil futures rose more than 2% on Friday as the Federal Reserve indicated interest rate cuts are coming, but prices fell for the week as slowing demand in China weighs on the market.

Fed Chairman Jerome Powell said the “time has come for policy to adjust” as inflation has declined significantly. Lower interest rates typically stimulate economic growth, which boosts oil demand.

But oil prices are still down for the week, with the U.S. benchmark falling 2.4% and global benchmark Brent edging lower by 0.83%.

Here are Friday’s closing energy prices:

• West Texas Intermediate October contract: $74.83 per barrel, up $1.82, or 2.49%. Year to date, U.S. crude oil has gained 4.4%.
• Brent October contract: $79.02 per barrel, up $1.80, or 2.33%. Year to date, the global benchmark is ahead 2.6%.
• RBOB Gasoline September contract: $2.28 per gallon, up 4 cents, or 1.81%. Year to date, gasoline is up 8.6%.
• Natural Gas September contract: $2.02 per thousand cubic feet, down more than 2 cents, or 1.27%. Year to date, gas is down 19.5%.

Traders have largely looked past volatile geopolitical tensions in the Middle East and adopted an increasingly bearish sentiment, as oil demand slows in China from electric vehicle sales and a softening economy.

“One thing that really is not factoring into oil prices right now is geopolitical risk,” Helima Croft, head of global commodity strategy at RBC Capital Markets, told CNBC’s “Fast Money” on Thursday.

“That has really evaporated from the market,” Croft said.

Traders speculated for weeks that Iran would retaliate against Israel over the assassination of a Hamas leader in Tehran, raising fears of a wider war that disrupts supplies. But an attack has not materialized.

“The market has really refocused on these demand concerns,” Croft said. “Chinese demand concerns have really weighed on this market as well as broader concerns about the macro outlook,” she said.