Oil prices extended losses on Friday, weighed down by fears of weakening United States demand and global oversupply, which overshadowed concerns about potential supply disruptions from conflicts in the Middle East and Ukraine.

Brent crude futures slipped 49 cents, or 0.74 per cent, to $65.88 a barrel early this morning, while U.S. West Texas Intermediate fell 51 cents, or 0.82 per cent, to $61.86.

“The (U.S.) inflation battle doesn’t quite look won, which dampens the demand outlook for oil from the world’s largest economy. Even geopolitical unrest is failing to support oil prices, as fundamentals point to an oversupply and lacklustre demand,” said Priyanka Sachdeva, senior market analyst at brokerage Phillip Nova.

Oil prices rose as much as 2 per cent earlier this week on fears of potential disruptions to output and trade from ongoing conflicts, but benchmarks began sliding on Thursday and have since erased those gains.

The selloff followed the International Energy Agency’s monthly report, which projected faster-than-expected growth in global oil supply this year, driven by planned production hikes from OPEC and its allies, including Russia.

In contrast, OPEC’s own report left its robust oil demand growth forecasts for 2025 and 2026 unchanged, citing continued strength in the world economy.