Oil fell on Friday, dropping more than 2% weekly due to the global increase in COVID-19 cases and the expectation that oil supply may increase in the coming weeks.
Brent crude oil futures LCOc1 fell 2 cents to $ 41.92, while West Texas Intermediate (WTI) crude oil futures CLc1 lost 6 cents to $ 40.25.
Both oil benchmarks fell, Brent to be 2.9% week on week, and WTI fell 2.1%.
A second wave of fear threatening the oil market discourages investors. As infections are on the rise in the Midwest of the United States which is the world’s largest oil consumer, New York City that was hit hardest in the spring considers renewed virus measures. More than 200,000 people died in the country from the virus. US fuel consumption is stagnant as the pandemic restricts travel and hinders economic recovery. The four-week average of gasoline demand was 9% less than the previous year.
In other parts of the world, the daily spikes of coronavirus infections are breaking records and new restrictions are being imposed to limit travel.
In India, the turnover of crude oil refineries has dropped 26% from a year ago, mostly in the last four months, as demand has declined as the epidemic hampered industrial and transport activities.
At the same time, more crude oil entering the global market threatens to lower prices by strengthening supply.
The number of US oil and gas drilling rigs is said to have increased by six to 261 by September 25.
Libya recently increased production. Meanwhile, Iran’s oil exports rose sharply in September, despite US sanctions, according to assessments based on tanker tracking.