WTI falls to near $66.00 due to concerns over weakening Oil demand

• WTI price drops as concerns over weakening oil demand rise amid decreasing odds of Fed rate cuts.

• The US NFP showed 147,000 new jobs added, while the Unemployment Rate declined to 4.1% in June.

• The US Treasury and State Departments announced sanctions targeting a network involved in smuggling Iranian Oil.

West Texas Intermediate (WTI) Oil price extends its losses for the second successive session, trading around $66.10 per barrel during the Asian hours on Friday. Crude Oil prices depreciate due to potential easing of Oil demand, driven by the solid job market, bolstering the case for the US Federal Reserve (Fed) keeping interest rates on hold. This is important to note that higher borrowing cost dampens economic activities in the United States (US), the world’s largest Oil consumer, and weaken crude prices.

The US Nonfarm Payrolls (NFP) showed that the US labor force grew by 147,000 jobs, surpassing the anticipated 110,000 in June. Additionally, the Unemployment Rate declined to 4.1% from 4.2%. Meanwhile, weekly Jobless Claims fell to 233,000, down from 237,000.

Moreover, investors are also awaiting clarity on US President Donald Trump's plans for tariffs on various countries. Trump said late Thursday that he “will begin sending letters on trade tariffs starting Friday.” He told reporters that he would send letters to 10 countries at a time, laying out tariff rates of 20% to 30%, per Reuters.

Additionally, the Organization of the Petroleum Exporting Countries (OPEC) and its allies, known as OPEC+, are prepared to announce an increase of 411,000 barrels per day in production for August at their meeting this weekend. The total output increase in 2025 will raise the gain to 1.78 million barrels per day, which is equivalent to more than 1.5% of global oil demand.

The downside of the Oil prices could be restrained as on Thursday, the US Treasury and State departments announced separate sanctions against a network that smuggles Iranian oil disguised as Iraqi Oil and a Hezbollah-controlled financial institution, according to Reuters.