India is the world’s third largest oil importer. Oil prices dropped $ 1 on Monday, fearing that demand for fuel will decline as Covid 19 cases escalate, while the anticipated increase in supply from OPEC + has also increased the pressure on prices.
Brent crude oil fell by $ 1.19 per barrel, or 1.8%, to $ 64.92 at 1014 GMT. West Texas Intermediate (WTI) crude oil was $ 61.06 a barrel, down $ 1.08, or 1.7%.
Both criteria have dropped by about 1% over the past week.
The market is focused on the bad news that the number of new coronavirus cases has increased sharply, coming from India and Japan, the world’s third and fourth largest crude oil importers.
India’s novel coronavirus infections reached a record peak on Monday. Countries like Britain, Germany, and the United States have promised to send emergency medical assistance to Indian hospitals to help fight the crisis.
It expects gasoline demand in India to drop by more than 100,000 barrels a day (bpd) in April and more than 170,000 barrels in May. India’s total gasoline sales were about 747,000 barrels per day in March.
It is also said that diesel demand, which is about 1.75 million barrels a day, which accounts for about 40% of refined fuel sales in India, could fall by 220,000 barrels a day in April and another 400,000 barrels a day in May.
In Japan, a third state of emergency began Sunday in Tokyo, Osaka and two other provinces, and nearly a quarter of the population affected as the country struggled to combat the increase in COVID-19 cases.
It is not yet clear whether India’s escalating cases will be enough to stop OPEC + and its allies from gradually loosening their production restrictions.
The Organization of Petroleum Exporting Countries and Russia-led allies will discuss supply policy at a meeting this week.
The group agreed at a meeting in early April to ease the production limits to 350,000 barrels a day in May, 350,000 barrels a day in June, and another 400,000 barrels a day in July.
The new OPEC + supply wave and renewed demand concerns point to a price drop for the summer months.
