Oil prices open lower on demand concerns, remain on track for weekly gain

Oil prices open lower on demand concerns, remain on track for weekly gain

Oil prices fell in early Asian trade on Friday as demand concerns weighed against strong economic data.

Brent crude fell 59 cents, or 0.7%, to $83.65 a barrel by 0027 GMT, but was on track for a weekly 5% increase. U.S. West Texas Intermediate (WTI) crude fell 51 cents, or 0.6%, to $79.58 a barrel, on track for a 5.2% weekly increase.

Oil rose last session as fears of a global economic slowdown were eased by strong earnings reports and better-than-expected U.S. economic data.

U.S. second quarter gross domestic product grew at 2.4%, beating the 1.8% consensus, the Commerce Department said Thursday, supporting U.S. Federal Reserve Chairman Jerome Powell's view that a the economy can achieve a so-called "soft landing."

But recent interest rate increases from global central banks seeking to tame stubborn inflation raised questions about long term demand.

On Wednesday, the U.S. Federal Reserve implemented another 25 basis point interest rate hike as widely expected, and the European Central Bank followed suit on Thursday.

Earlier this week oil fell after data showed U.S. crude inventories fell less than expected and the U.S. Federal Reserve raised interest rates by a quarter of a percentage point, leaving the way open for another increase.

"We are still not seeing much translation to increased product demand especially within the distillates that have been providing much of the upside lead of the past month," said Jim Ritterbusch, president of Ritterbusch and Associates LLC in Galena, Illinois.