Early on Friday, WTI crude oil prices are trading steady but look all set to post a weekly decline of 5% on fears of the coronavirus outbreak impacting economic growth in China and around the world. At the time of writing, WTI crude oil is trading at around $55.67 per barrel.

WTI crude oil declined by as much as 2% in the previous session to the lowest level since November 29 as China reported over 800 confirmed cases of coronavirus across the country and announced a lockdown in Wuhan city to prevent further spread of the virus. However, oil prices received some relief from the WHO not declaring the virus as a global emergency yet.

Any weakening in economic growth, especially in China which is the among the world’s largest consumers of oil and energy products, can reduce the demand for oil. Amid continued strong supply, declining demand can drive oil prices lower.

Crude oil has also weakened after the release of the EIA report on Thursday which revealed a lesser than expected decline in US crude inventories. According to the report, crude stockpiles in the US reduced by 405k barrels during the previous week, while economists were expecting a 1 million barrel decline for the period.