Oil declines as U.S. virus cases hit record, heading for weekly fall

08:56 10 July in Latest News

© Reuters. FILE PHOTO: Pump jacks operate at sunset in Midland

-Oil prices fell on Friday, adding to steep losses from the previous session, and were headed for weekly declines on worries that renewed lockdowns following a surge in coronavirus cases in the United States and elsewhere could suppress fuel demand.

Brent crude (LCOc1) was down by 73 cents, or 1.7%, at $41.62 a barrel by 0712 GMT after falling more than 2% on Thursday. U.S. oil (CLc1) fell 83 cents, or 2.1%, at $38.79 a barrel after a drop of 3% in the previous session.

Brent looks set for a weekly decline of nearly 3% and U.S. crude for a fall of around 4.5%. Trading was quiet with Singapore on holiday for an election.

While many analysts are expecting economies and fuel demand to bounce back from the pandemic, record daily increases in coronavirus infections in the United States, the world’s biggest oil consumer, raised concerns about the pace of any recovery.

“We may need evidence that the U.S. has brought Covid-19 under control … to spark a sustained rally beyond the present wider ranges,” said Jeffrey Halley, senior market analyst at OANDA.

More than 60,500 new COVID-19 cases were reported in the United States on Thursday, setting a daily record, with Americans being told to take new precautions. The tally was also the highest daily count yet for any country since the pathogen emerged in China late last year.

In Australia, the government on Friday will consider reducing the number of citizens allowed to return to the country from overseas, after authorities ordered a new lockdown of the country’s second-most populous city, Melbourne.

Oil inventories remain bloated due to the evaporation of demand for gasoline, diesel and other fuels during the initial outbreak.

U.S. crude oil inventories rose by nearly 6 million barrels last week after analysts had forecast a decline of just over half that figure. [EIA/S]

( – Stock Market Quotes & Financial News)