The price of oil rose Friday on concerns that tensions over Ukraine could rise with this weekend’s referendum on Crimean secession.
But oil still finished the week down more than three per cent, largely because traders were concerned about the strength of demand from China.
Benchmark West Texas Intermediate crude for April delivery rose 69 cents to close at US$98.89 a barrel on the New York Mercantile Exchange on Friday. But for the week, oil was down US$3.69 a barrel, or 3.6 per cent.
Brent crude, used to set prices for international varieties of crude, rose US$1.18 to US$108.57 Friday on the ICE Futures exchange in London.
China is one of the top consumers of energy, so an economic slowdown there could dial back demand for oil.
“The energy complex has morphed into a trade where Chinese economic releases will be a strong determinant of near-term oil price direction,” Jim Ritterbusch, president of energy consultancy Jim Ritterbusch and Associates, wrote in a note to clients.
At the same time, Russia is one of the top producers of oil worldwide, meaning that any western sanctions against Moscow for its military incursion into the Ukraine’s Crimean peninsula could affect global supplies.
The West braced for a vote Sunday by residents of Crimea on whether secede from Ukraine — and likely be annexed by Russia — as the last attempt for diplomacy broke down despite threats of costly international sanctions and other imminent penalties against Moscow for forcibly challenging a pro-European government in Kyiv.
In other energy futures trading on Nymex, wholesale gasoline rose three cents to US$2.96 a U.S. gallon (3.79 litres), heating oil rose two cents to US$2.94 a gallon and natural gas added four cents to US$4.43 per 1,000 cubic feet.