Crude oil and refined product futures contracts are all seeing strong losses heading into Friday afternoon, giving back much of the previous day's gains, and setting prices up for weekly losses.

Crude contracts were off by more than $1/bbl at about 11 a.m. ET, while gasoline and diesel futures were falling by more than 4cts/gal.

Refined product prices rallied on Thursday after the latest Energy Information Administration data showed declines in distillate and gasoline inventories amid a continued significant decrease in U.S. refinery operations.

That decrease has also led to builds in U.S. crude oil inventories. Those builds, along with indications the U.S. Federal Reserve is hesitant to begin cutting interest rates, are pressuring prices even as ongoing tensions in the Middle East raise supply concerns.

The April contract for U.S. benchmark West Texas Intermediate crude was down $1.30/bbl to $77.31/bbl while May prices fell $1.16/bbl to $76.77/bbl, with both contracts more than 20cts off last Friday's settlement. The April contract for European benchmark Brent crude was $1.26/bbl in the red to $82.43/bbl while May prices slipped $1.16/bbl to $81.54/bbl. Brent contracts are more than $1/bbl lower than last week's levels.

Diesel futures prices saw a steep slide during the week, with that weakness resuming Friday. The March USLD contract was down 4.82cts to $2.7038/gal with April prices falling 4.65cts to $2.6568/gal. Both contracts have shed more than 10cts/gal since last Friday.

Diesel prices are facing headwinds as a warmer than expected winter is crimping demand and the forecast calling for unseasonably warm temperatures in much of the country starting next week.

Weekly losses were lighter for RBOB contracts. The March contract was down 4.17cts to $2.2930/gal Friday, placing it more than 2cts/gal lower than a week ago. The April contract, which represents a more expensive summer blend of fuel, was down 4.04cts to $2.5295/gal.

While gasoline demand has been lackluster so far in 2024, many expect demand to see a strong increase as Spring approaches and some in the industry wondering if U.S. refinery downtime will lead to an unbalance in supply in coming months, particularly as winter blends of fuel transition to summer specifications.

This content was created by Oil Price Information Service, which is operated by Dow Jones & Co. OPIS is run independently from Dow Jones Newswires and The Wall Street Journal.

--Reporting by Steve Cronin,; Editing by Cory Wilchek,

(END) Dow Jones Newswires

02-23-24 1156ET