Oil prices rise on supply concerns

Oil rose as investors weighed the tightening outlook for energy supplies against persistent concerns about a global economic slowdown. U.S. crude rose to $89 a barrel after falling 2 percent on Thursday. The OPEC+ alliance is set to make significant cuts in output starting this month, followed by European Union sanctions on Russian crude from December. A global diesel shortage is also adding to the supply crunch. Oil is on track for a second weekly gain but has lost nearly a third of its value since June as concerns about a slowdown weigh on demand. Crude has fluctuated in recent sessions along with broader market trends and changes in the dollar, helped by lackluster trading volumes. European Central Bank President Christine Lagarde said a “mild recession” was possible after further rate hikes from the Federal Reserve and the Bank of England. Saudi Arabia also lowered oil prices to Asia for its December sale, highlighting concerns about the demand outlook. The kingdom sells most of its crude to the region under long-term contracts. "Downside risks to global economic conditions, coupled with a stronger dollar in a tighter policy outlook, will continue to be headwinds," said Yeap Jun Rong, chief market strategist at IG Asia in Singapore.