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Oil down 5% on rising virus cases and weakening economic outlook

by Bunkerist
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Oil prices fell about 5% on Monday. Rising COVID-19 infection rates in Europe and other countries lead to renewed lockdown measures and raise doubts about economic recovery, as well as the potential return of Libyan production, raising fears of oversupply.

Prices retreated amid growing concerns that the increase in coronavirus cases could reduce demand. It seems that more than 30.78 million people are infected with the new coronavirus. Cases in England, Spain and France also escalated.

Analysts say it is quite difficult to paint a pink picture as before, with more gloomy news about the jet fuel demand.

Brent crude LCOc1 settled down $1.71, or 3.96% at $41.44 a barrel. West Texas Intermediate (WTI) crude CLc1 fell $1.80, or 4.38% to $39.31 a barrel.

Both contracts were set for their biggest daily drops in two weeks.

Meanwhile, according to shipping data, a Suezmax tanker is heading towards Libya’s Marsa El Hariga terminal. In the market, the forecast that Brent would reach $ 49 a barrel at the end of the year and $ 65 a barrel in the third quarter of next year, despite developments in Libya, and the forecast that the 2020 Brent outlook of $ 43 per barrel, and $ 53 next year continue.

The loyalty between the Organization of Petroleum Exporting Countries (OPEC) members and their allies about adhering to the production cut agreement feeds hopes.

Meanwhile, stocks of distillates, including diesel, were seen to rise, while U.S. crude oil and gasoline inventories fell last week.

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