NEW YORK (Reuters) - Crude prices rose on Friday, but declined on the week on worries that oversupply would weigh on the U.S. market while trade disputes and slowing global economic growth would dampen demand for oil.

FILE PHOTO: A pump jack operates at a well site leased by Devon Energy Production Company near Guthrie, Oklahoma September 15, 2015. REUTERS/Nick Oxford/File Photo

U.S. crude declined for the seventh consecutive week, and global benchmark Brent was dropped for a third week.

“One of the biggest concerns out there is that China’s demand numbers are coming down if China’s GDP growth is slowing,” said Tariq Zahir, managing member at Tyche Capital in New York.

Brent crude oil futures LCOc1 settled up 40 cents, or 0.6 percent, at $71.83 a barrel, after touching a high of $72.49 earlier in the session.

U.S. West Texas Intermediate crude futures (WTI)CLc1 rose 45 cents , or 0.7 percent, to $65.91, after touching a session high of $66.39.

For the week, Brent was down 1.4 percent, and U.S. crude fell 2.6 percent.

Falling prices have weighed on funds with oil exposure. Two of the world’s largest energy-focused hedge funds, Andurand Capital and BBL Commodities, suffered double-digit percentage losses in July as oil prices plunged by the most in two years, sources familiar with the matter told Reuters.

Money managers cut their net long U.S. crude futures and options positions to the lowest in nearly two months in the week to Aug. 14, the U.S. Commodity Futures Trading Commission (CFTC) said.

Friday’s pull back from session highs came on mounting worries that U.S. crude inventories would post another consecutive gain, said Bob Yawger, director of futures at Mizuho Americas.

U.S. government data this week showed a large build up in crude inventories C-OUT-T-EIA, with production C-OUT-T-EIA also increasing. [EIA/S]

“Investors remain cautious as Wednesday’s surprise gain in U.S. stockpiles remained fresh in their minds,” ANZ bank said on Friday.

The number of U.S. oil drilling rigs, an indicator of future production, was unchanged this week at 869 rigs, much higher than the 763 rigs operating a year ago, according to energy company Baker Hughes.[RIG/U]

Another major drag on prices was the darkening economic outlook on trade tensions between the United States and China, and weakening emerging market currencies that are weighing on growth and fuel consumption, traders and analysts said.

U.S. investment bank Jefferies said there was a “lack of demand” for crude oil and refined products from emerging markets, while Singapore’s DBS bank said that Chinese data showed a “steady decline” in activity and that “the economy is facing added headwinds due to rising trade tensions”.

Japan’s MUFG Bank, meanwhile, said that the weakening Turkish lira will constrain further growth in gasoline and diesel demand this year.

“Although emerging market contagion and China slowdown fears seem somewhat overstated, neither fundamental nor sentiment should provide support for higher commodity prices,” Julius Baer Head of Macro and Commodity Research Norbert Rücker said.

Furthermore, just as demand seems to be slowing, supply looks to be rising, increasing the drag on markets.

(Graphic: U.S. oil drilling, production & storage levels: tmsnrt.rs/2OAyO8P)

IRAN SANCTIONS

Despite the bearish factors, analysts said prices were prevented from falling further because of U.S. sanctions against Iran, which target the financial sector from August and will include petroleum exports from November.

“Iranian crude exports were still near 2 million barrels per day (bpd) in July and will likely begin to fall dramatically in August with financial sanctions taking effect. With oil export sanctions now three months out, we expect exports to fall by more than 500,000 bpd by the end of 3Q,” Jefferies said.