Oil falls below US$80 with bulls fleeing as physical demand slows

Oil futures fell below US$80 a barrel, extending a sharp weekly decline, as the global crude market softens amid signs of an oversupplied market.

Pullbacks were evident along most of the oil-trading complex. On Friday, the US prompt-spread flipped into contango, a structure that signals oversupply, for the first time since last year. Meanwhile, a deteriorating market for physical barrels has also weighed on prices, as demand for winter-delivery cargoes has weakened. 

Oil futures are trading at their lowest level since September amid swelling Covid cases in China and aggressive monetary tightening by central banks. West Texas Intermediate shed as much as 5.4 per cent to trade near US$77 a barrel, down almost 12 per cent this week.