RoydadNaft –  Oil prices settled slightly lower on Friday but recorded a weekly gain as Middle East tensions and disruptions to oil output offset concerns about the Chinese and global economies.

Brent futures settled 54 cents lower at $78.56 a barrel. U.S. West Texas Intermediate crude fell 67 cents to settle at $73.41.

For the week, Brent gained about 0.5% while the U.S. benchmark rose over 1%.

“The Chinese equity market this week dropped to near a five-year low,” said Bob Yawger, director of energy futures at Mizuho Bank. The indication for weaker demand drove crude prices down on Friday.

In the Middle East, geopolitical risks supported prices for the week.

Although conflict in the Middle East has not shut any oil production, supply outages continued in Libya.

In the U.S., about 30% of oil output in North Dakota, the country’s third largest producing state, remained shut due to extreme cold, the state’s pipeline authority said on Friday.

Output had been cut by some 700,000 bpd, or more than half, midweek.

It could take a month for production to return to normal levels, the state regulator said on Friday.

“Supply disruptions remain an upside risk but there are downside risks too, including the global economy,” Craig Erlam, analyst at brokerage OANDA, said.

“The forecast for global oil demand growth remains unclear, with stakeholders and research institutions providing widely differing projections,” analyst Bjarne Schieldrop of SEB said.

The premium of the first-month Brent contract to the six-month contract rose to as much as $2.15 a barrel on Friday, the highest since November. This structure, called backwardation, indicates a perception of tighter supply for prompt delivery.

Money managers cut their net long U.S. crude futures and options positions in the week to Jan. 16, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday.