Oil prices had marginal gains on Tuesday. Concerns of reducing the demand about the resurgence of coronavirus infections around the world is healed with the increasing hopes to cut more crude oil if needed.
Brent crude LCOc1 edged up 9 cents, or 0.2%, at $39.81 a barrel by 06:59 GMT, having gained 2.6% on Monday. WTI oil CLc1 gained 3 cents, or nearly 0.1%, to $37.15 a barrel, after closing 2.4% higher in the previous session.
The coronavirus cases rose more than 8 million worldwide worldwide on Monday, infections in Latin America have increased, the US and China are struggling with fresh outbreaks, but some observers say they are not expecting a return to tight lockdowns started after the beginning of this year.
The Organization of the Petroleum Exporting Countries (OPEC), OPEC + producer exporters and their allies, including Russia, also helps to prevent higher price decreases, as major producers are talking about further decreases in oil supply in case of a necessity.
Allies, including the Organization of the Petroleum Exporting Countries (OPEC) and OPEC +, Russia, have decided to extend the production cut to 9.7 million barrels a day by the end of July this month. Later on, they also urged members who did not fulfill their commitments with the extra outages, to comply with the commitments.
US shale oil producers are also pulling back their volume due to the collapse in oil demand.
Production from the seven major US shale oil production is expected to drop to 7.63 million barrels a day, the lowest of two years by July. Many drilling rigs stopped production, and the number of oil rigs dropped below 200 last week.