By Gina Lee

Investing.com – Oil was down Friday morning in Asia as U.S. supplies continue to tighten. This week’s black liquid saw a flat close, as lower gas and coal prices helped curb the fuel-switching which had led to increased oil product demand.

The price dropped 0.53% to $84.16 at 12:38 PM ET (4:38 GMT) and fell 0.4% to $82.14.

The markets reached multi-year peak levels earlier this week due to concerns over coal and gas shortages, including in China, India, and Europe. Power providers switched to diesel and to fuel oil.

“Weaker and coal prices would have taken away some of the support for the oil market,” ING commodities strategists said in a note.

Meanwhile, Wednesday’s data from the U.S. Energy Information Administration showed fell to 31.2 million barrels, their lowest level since October 2018. The U.S. crude oil was expected to rise 0.5% for the week despite the low levels. This is not too far from the seven-year peak reached earlier in this week.

“However, there are clear concerns over the inventory drain that we are seeing at the WTI delivery hub, Cushing,” the ING note said

The market was seeing some momentum as investors shifted their focus from the skyrocketing crude prices at the beginning of each month, said Royal Bank of Canada analysts.

“Some investors are also trimming risk across various energies, with the rationale being that energy crisis euphoria has peaked,” RBC analyst Michael Tran said in a note, which added, “these are not necessarily our views.”