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Oil Heading For Weekly Gain On Demand Recovery Hopes

Oil prices fell on Friday after retail sales and industrial production numbers for July continue to point to weak recovery in China.

Benchmark Brent crude dropped 30 cents, or 0.7 percent, to $44.66 a barrel, but was heading for gain of more than 1 percent for the week on optimism about the pace of oil demand recovery.

Similarly, West Texas Intermediate crude futures were down 25 cents, or 0.6 percent, at $41.99 but headed for a gain of over 2 percent for the week.

Official data showed today that China's industrial production grew 4.8 percent on a yearly basis in July, the same rate of growth as seen in June and weaker than the expected rise of 5.1 percent.

Retail sales dropped 1.1 percent from last year, confounding expectations for an increase of 0.1 percent.

During January to July period, fixed asset investment decreased 1.6 percent versus a 3.1 percent decrease in January to June.

Elsewhere, the euro area economy contracted at a record pace in the second quarter, as initially estimated, due to the containment measures taken by member countries to control the spread of the coronavirus, flash estimate from Eurostat showed.

Gross domestic product fell 12.1 percent sequentially in the second quarter, following a 3.6 percent drop in the first quarter. This was the sharpest decline seen since the series began in 1995.

Year-on-year, GDP was down 15 percent versus a 3.1 percent decline a quarter ago. This was also the sharpest decrease since 1995.

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