Europe Markets

Europe ends lower; oil, Greece in focus

Europe ends lower; Oil, Greece in focus

European equities closed lower on Friday, with the standoff between Greece and its creditors seemingly intensified.

The pan-European FTSEurofirst 300 closed around 0.8 percent lower, having pared some losses during the day. It was roughly flat on the week.

The benchmark Athens Composite closed nearly 6 percent lower on the day and roughly 1.5 percent down on the week. Greek bonds sold off, with yields on 10-year government debt climbing to 11.8 percent.

The back and forth between Greece and its lenders remains unresolved after the IMF announced that its delegation had left negotiations in Brussels and flown home because of "major differences" with Athens over how to save the country from bankruptcy.

Read MoreGreek talks in crisis after IMF leaves table

Following the failed talks, senior euro zone officials reportedly discussed a "plan B" for a Greek debt default for the first time. Reuters reported that a deal with Greece in June was not seen as likely, citing euro zone officials.

Greece weighed on other European bourses, as well as U.S. stocks.

London's FTSE 100 index closed around 0.9 lower, while the French CAC and German DAX tumbled to close around 1.4 and 1.2 percent lower respectively. All three major bourses however pared losses at the end of afternoon trade.

Oil in focus

Oil markets were also in focus after top oil producer Saudi Arabia said Thursday it was ready to increase its oil output in the coming months to a new record, in order to meet a rise in global demand, despite a gloomier global growth outlook.

Oil prices slipped on Friday, with Brent crude trading 81 cents lower at $64.30 a barrel, while U.S. light crude was down 85 cents at $59.93 around the stock market close.

Overall, oil and gas stocks under-performed, with the sector index closing around 1.7 percent lower.

Fading boost from oil?

On the data front, euro zone industrial production data indicated that any boost from the weaker oil price and euro at the start of the year mightalready be fading.

After a revised 0.4 percent fall in March, production rose by just 0.1 percent in April, which dragged the annual growth rate down to just 0.8 percent.

"Looking ahead, euro-zone industry's weak start to the second quarter indicates that it is unlikely to fare as well as it did in first quarter," European economist at Capital Economics, Jessica Hinds, said.

After the market close, ratings agency Standard & Poor's revised the U.K.'s economic outlook to "negative" from "stable," citing the risks posed by its possible departure from the European Union.

Follow us on Twitter: @CNBCWorld