Oil prices decreased during the week ending due to the recession fears in the US, while the OPEC+ group’s decision to delay a planned production increase, strong demand data from the US, and uncertainties regarding the extent of future interest rate cuts by the US Federal Reserve (Fed) limited further price falls.

The International benchmark Brent crude traded at $72.91 per barrel, down by around 5.2% relative to the closing price of $76.91 a barrel last week. West Texas Intermediate (WTI), the American benchmark, traded at $69.07 a barrel at the same time on Friday, a decrease of about 5.6% from last Friday’s session, which closed at $73.17 per barrel.

Oil prices are set for a weekly loss with rising expectations that the decision to suspend oil production in Libya could be reversed. The UN Support Mission in Libya (UNSMIL) said it hosted separate talks on Monday in Tripoli to resolve a crisis surrounding the Central Bank of Libya.

The discussions concluded with a ‘significant understanding’ of how to address the crisis and restore the confidence of Libyans and international partners in the vital institution, UNSMIL revealed. These compromises have eased market players’ concerns about possible supply shortages, putting downward pressure on oil prices.

Moreover, the macroeconomic data released in the US on Tuesday supported the predictions that the world’s largest oil-consuming country could go into recession and supported downward price movements.

The US Institute of Supply Management’s (ISM) Manufacturing Purchasing Managers Index (PMI) rose to 47.2 in August, but remained below market expectations. S&P Global’s manufacturing PMI came in at 47.9 in August, slightly below estimates.

After the PMI data, which indicated the continuous contraction in the manufacturing sector, the US 10-year Treasury bond yield fell 4.83%, down 9 basis points. However, prices started to recover following the decision of the OPEC+ group, which consists of OPEC and some non-OPEC producing countries, to delay the production increase originally scheduled for October after a prolonged decline in prices.

The decision feeds market players’ concerns about global oil supply and limited further price falls. Meanwhile, the data from the Energy Information Administration (EIA) released late Thursday contributed to the price rises by indicating a stronger-than-expected demand in the world’s largest oil consuming country.

According to the data, US commercial crude oil inventories decreased by approximately 6.9 million barrels to 418.3 million barrels during the week ending August 30, which was more than the market forecast of a decrease of around 600,000 barrels.

Uncertainty surrounding the Fed’s next moves on interest rates also continued to influence prices throughout the week. While it is widely anticipated that the bank will cut interest rates by 100 basis points by the end of the year, estimates for a 50-basis-point cut in September stand at 43%.

A potential interest rate cut is expected to weaken the US dollar and increase the demand for oil. On Friday, the US dollar index fell by 0.09% to 101.01, compared to the previous trading session.