Oil prices fell for a second day on Friday after the International Energy Agency warned that demand growth for crude oil and its products had slowed sharply. Rising COVID-19 cases worldwide forces governments to reinvigorate movement restrictions.
Brent which fell 13 cents in the previous session was down 58 cents, or 0.8%, to $70.73 as of 0630 GMT.
West Texas Intermediate (WTI) crude which fell 0.2% on Thursday, was off by 65 cents, or 0.9%, at $68.44 a barrel,.
The benchmarks were changed little this week.
The IEA said on Thursday that growing demand for crude stalled in July and will increase at a slower pace for the remainder of 2021 due to an increase in infections from the coronavirus Delta variant.
The IEA’s sudden return has shaken the nerves and brought to a halt the oil rally, revealing the reality of the Delta variant’s impact.
Banks also lowered their short-term demand forecasts.
Oil demand reaching just 98.3 million barrels per day (bpd) almost stalling in August, and extected to be avarage of 97.9 million barrels per day in September.
Conversely, OPEC on Thursday adhered to forecasts for a recovery in global oil demand this year and further growth in 2022, despite growing concern about the rise in COVID-19 infections.
In its monthly report the Organization of the Petroleum Exporting Countries (OPEC), also raised its expectations for supplies next year from other producers, including U.S. shale oil despite it could potentially snarl efforts by the group and allies
Although OPEC has not changed its demand forecast, it is thought that the short-term demand outlook is deteriorating, and all mean that the group may cut its supply plans down at its next meeting.