Oil prices fell more than 1% on Monday due to the permanent abundance of products and the economic inconveniences caused by the coronavirus pandemic. It canceled support from supply cuts implemented by major manufacturers in the world.
Brent crude futures LCOc1 were down 51 cents, or 1.7%, at $30.46 a barrel by 0624 GMT, while U.S. West Texas Intermediate crude futures CLc1 fell 49 cents, or 2.0%, to $24.25 a barrel.
Both criteria have increased their gains over the past two weeks, with the relief of social deadlocks and a moderate recovery of fuel demand, as countries have increased their normalization efforts, as well as the social deadlocks to cope with the coronavirus. Worldwide oil production is also decreasing.
However, potential signs of a second wave of coronavirus infections in northeastern China and South Korea have worried investors as more countries would make moves to alleviate oil demand and alleviate pandemic constraints.
Authorities need to be much more prepared to deal with a second wave right now. The last thing people worry about and want is the restart of crashes. If the risk environment becomes widespread, it is inevitable to see the bottom again.
Global demand for oil fell by approximately 30% as global stocks increased with the implementation of coronavirus pandemic restrictions worldwide.
Fear of the US depletion of storage space has triggered WTI prices to drop to the negative zone last month, and has caused some US producers to cut production.
The number of operating oil and gas facilities in the world’s largest oil producer fell to a record low as 374 last week.