Crude oil prices fall on mixed economic signals; Brent below $85/barrel, WTI down 0.8%

Crude oil prices declined in early trade on Friday, as mixed economic signals emerging from the United States – the world's biggest oil consumer – have weighed on investor sentiment.

Global crude benchmark Brent slipped below the $85 per barrel mark. Its futures for September delivery were trading 54 cents or 0.63% lower at $84.57 a barrel at 0230 hours GMT.

The U.S. West Texas Intermediate (WTI) crude futures for August delivery were trading 69 cents or 0.83% lower at $82.13 per barrel.

Mixed economic signals

The decline comes a day after crude oil prices rose on the growing optimism over the US Federal Reserve likely initiating its rate-cut cycle in the near future.

However, the optimism was partially dampened with the release of US manufacturing data, that showed factory output rising by 1.1% year-on-year in June. This was higher than the expectation of 0.2% growth, as estimated by analysts polled by Reuters.

An uptick in factory output may deter the Fed from expediting a cut in the benchmark lending rates, even as other economic indicators signal the need to ease the monetary policy.

The US unemployment data released on Thursday may also turn the Fed officials cautious, as the number of jobless claims was far lower than the forecast.

In the week ended July 13, around 20,000 Americans file for unemployment benefit claims, the US Labor Department said. On the other hand, economists polled by Reuters had estimated the number to reach 230,000.

Notably, the crude market is awaiting a decrease in the benchmark lending rates, as more liquidity would spur consumption. This, in turn, would increase oil demand in the world's largest economy.