Crude oil prices fell on Thursday after OPEC announced that it expects fuel demand to decline more than anticipated, but the U.S. suggested that despite the coronavirus outbreak, stocks were falling and demand returned.
Brent crude LCOc1 was down 26 cents or 0.6% at $45.17 a barrel by 0647 GMT, after a gain of around 2% in the previous session. West Texas Intermediate (WTI) CLc1 oil also lost 0.6%, a 25 cent decline to $42.42 a barrel which followed a climb of 2.6% on Wednesday.
According to a monthly report, OPEC said world oil demand will drop by 9.06 million barrels this year, more than the anticipated 8.95 million barrels drop a month ago. There are concerns that world oil demand in 2020 will fall steeper than previously anticipated due to the coronavirus, and there are doubts about next year’s recovery.
Still, US crude oil, gasoline and distillate inventories fell last week due to increased demand, although refineries increased production. US fuel demand rose to 19.37 million barrels a day last week. While this was the highest level since March, crude oil production fell from 11 million barrels per day to 10.7 million barrels per day.
Crude oil stocks USOILC = ECI fell 4.5 million barrels compared to analysts’ expectations of a 2.9 million barrel drop.
U.S. crude oil production is forecast to drop by 990,000 barrels a day this year to 11.26 million barrels a day, faster than the estimated 600,000 barrels drop last month, suggesting that world oil demand is doubtful.
Meanwhile, the uncertainty of news about the aid package from Washington, which is mentioned to support recovery from the deep impact of the coronavirus pandemic, is among the factors that affect prices.