Oil prices dipped on Monday as rising coronavirus cases upset hopes for a recovery that is smooth fuel need, with the main crude benchmarks on track for their first monthly falls in multiple months after last week’s slips.
Brent crude (LCOc1) fell 23 cents, or 0.6%, to $41.69 a barrel by 0243 GMT after dropping 2.9% a week ago. U.S. western Texas Intermediate (CLc1) was at $40.04 a barrel, down 21 cents or 0.5%, following a 2.1% decline week that is last.
Brent is on course to fall for the month that is first six while WTI is headed for its first monthly loss since April as the reimposition of mobility curbs in some countries clouds the outlook on fuel demand recovery.
“New COVID-19 case numbers are accelerating in major U.S. states, renewing fears of mobility restrictions challenging the oil that is ongoing data recovery into the last quarter,” ANZ analysts said in a note.
More crude is also being exported from OPEC producers Iran and Libya despite efforts by the corporation regarding the Petroleum Exporting Countries and their allies to limit output.
Last week, U.S. energy firms also included oil and fuel that is natural for the second week in a row, according to Baker Hughes.
Still, OPEC Secretary General Mohammad Barkindo stated on Sunday that commercial oil inventories in OECD countries are expected to face only slightly above the average that is five-year the first quarter of 2021, before dropping below that level for the rest associated with year.
The one factor which will offer some help to the market is the prospect of hit action, ING analysts said. Oil prices dipped on Monday as rising coronavirus cases upset.
In Norway, one of many oil producers which are largest outside OPEC, a workers’ strike that may take place on Sept. 30 is threatening to cut its production by 900,000 barrels per day, the Norwegian Oil and Gas Association (NOG) stated on Friday.
Additionally, one regarding the heaviest clashes between Armenia and Azerbaijan since 2016 broke out over the weekend, reigniting concern about stability in the South Caucasus, a corridor for pipelines carrying gas and oil to globe markets.
The U.S. Commodity Futures Trading Commission (CFTC) said on Friday that money supervisors raised their net U.S. that is long crude and options positions into the week to Sept. 22.
“The bulk of the buying which was seen on the week was driven by short-covering, with the gross position that is short by a small over 20k lots,” the ING analysts said. Investors may have heeded the oil that is Saudi’s warning against shorting the oil market, they said.