Brent crude futures were at $76.74 a barrel, up 59 cents, or 0.8%, at 01:15 GMT after falling 1.3% on Thursday.
U.S. West Texas Intermediate crude rose 68 cents, or 1%, to $72.14 a barrel after falling 0.8% in the previous session.
News of an accident shutting down TC Energy’s Canadian Keystone pipeline in the United States prompted a brief rally on Thursday, but prices eventually fell as the market believed the shutdown would be brief. More than 14,000 barrels of crude oil spilled into a Kansas creek, making it one of the largest crude oil spills in the United States in nearly a decade.
The news appears “only negative in the short term for supply but does not change the deteriorating outlook for crude demand,” OANDA analyst Edward Moya said in a note.
WTI prices are near the $70 level, and that’s where the Biden administration should start looking to fill the strategic oil reserve, he added.
Previous outages caused by a spill are usually fixed in about two weeks, RBC Capital analyst Robert Kwan said, although the latest outage may take longer given that it involves a spill in a creek.
Oil prices are set to post their biggest weekly decline in months as traders expect it will be months before the benefits of China’s easing of COVID controls trickle down to demand.
Soaring infections will likely slow China’s economic growth in the coming months, leading to a rebound only later in 2023, economists have said.
