Oil prices fell in early Asia trade on Friday as demand concerns outweighed the prospect of tighter supply from global producers, while investors were sceptical that the United States and Iran could strike a nuclear deal.
Both benchmarks slid by $1, rebounding from their earlier losses of more than $3, as the U.S. and Iran both denied a report by the Middle East eye that they were close to a nuclear deal.
There were about 1% losses in the week and a second week of losses. Oil prices rose early this week, following Saudi Arabia's pledge over the weekend for deep output cuts, but they pared gains due to rising U.S. fuel stocks and weak Chinese export data.
Satoru Yoshida, a commodities analyst with Rakuten Securities, said the market is still sceptical about the U.S.-Iran nuclear deal.
He added that there is both upside and disadvantage pressure on prices, with worries over tighter supply and expectations of higher demand as the United States enters driving season being offset by worries over further U.S. interest rate hikes and slow pickup in China's fuel demand.
Oil prices are expected to remain about 3 dollars above and below $70 for WTI in the near term, said Yoshida.
On Thursday, the United States and Iran both denied a report that they were nearing an interim deal under which Tehran would curb its nuclear program in exchange for sanctions relief that would include exporting up to 1 million barrels of oil per day.
However, some analysts say oil prices could get a lift if the Fed avoids a rate hike at its next meeting on June 13 - 14 in New York. Economists polled by Reuters expect no hike at the meeting.