- Oil benchmarks crept higher Friday, with Brent crude at $86.68 a barrel and WTI at $79.76.
- Discussions about western countries capping Russian crude at between $65 and $70 a barrel continue.
Oil prices edged higher on low trading volume Friday even as western countries continued their discussions about a price cap on Russian crude and China enforced further lockdown measures.
Brent crude traded 1.7% higher at $86.68 a barrel at last check, while WTI crude had climbed 2.3% to $79.76 a barrel.
Those benchmarks are still on course to finish in the red this week as talks of a price cap on Russian oil continue.
Diplomats from the G7 group of countries and the European Union are discussing capping Russian oil at between $65 and $70 a barrel as part of a broader sanctions package. Russian Urals oil slipped 5.3% on Friday to $67 a barrel.
"Talks will continue on a price cap but it seems it won't be as strict as first thought, to the point that it may be borderline pointless," Oanda market analyst Craig Erlam said.
"That's hit oil prices again this week as the threat to Russian output from a $70 cap, for example, is minimal given it's selling around those levels already."
Further Covid-19 lockdowns in China could also weigh on crude prices, Erlam said. The world's top oil importer logged a new daily case record on Friday, with Beijing putting cities across the country into lockdown. The move could reduce oil demand.
"Lockdowns in all but name appear to be popping up in major Chinese cities in an attempt to get a grip on record cases which will weigh heavily on economic activity once more and in turn demand," Erlam said.
"It's now a question of how long they last but clearly investors' enthusiasm toward the relaxation of Covid restrictions was a bit premature."
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