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Rising coronavirus incidents and Libyan oil supply prospects lower oil price

by Bunkerist
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Investors are worried about, the rising COVID-19 incidents may hurt demand and Libyan oil production’s revival  which has been slowing down since the beginning of the year may increase the global supply. Prices fell slightly on Tuesday.

The more-active September contract for Brent LCOc2 settled down 58 cents at $41.27 a barrel. The August contract LCOc1, which expires on Tuesday, fell 56 cents, or 1.2%, to $41.15. The contract has gained 16.5% this month so far, and 81% on the quarter.

WTI crude CLc1 was down 43 cents, or 1%, at $39.27 a barrel. U.S. crude has risen 12.4% in the past month, up about 95% in the quarter, reflecting its recovery from late March. The contract pared losses in post-settlement trade after a larger-than-expected draw in U.S. crude stockpiles.

Fuel demand recovered after the most common weeks of the outbreak, but cases continue to rise in the southern and southwestern states of the USA. Northeast states, such as New York and New Jersey, have doubled the state where travelers are faced with quarantine restrictions.

Investors will look for signs of a recovery in demand in the weekly US official inventory data on Wednesday.

Libya has been trying to maintain exports that have been almost completely blocked since January due to the civil war. The state-owned oil company hopes that the talks will end the blockade of the east-based forces.

By the way, the likely increase in Libyan oil output will make OPEC +’s  a little more difficult.

According to analysts, with gains in the fourth quarter of this year the price of oil expects that it will consolidate around $ 40 a barrel.

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