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Virus fears increase, oil prices drop

by Bunkerist
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Oil prices dropped on Wednesday, as industry data showed a larger than expected stock increase in the United States.

Official statements saying that the epidemic will worsen in the USA increases the severity of the situation.

US crude oil inventories rose by 7.5 million barrels last week, in response to the expectation of 2.1 million barrels.

Brent crude fell 35 cents, or 0.8%, to $43.97 a barrel by 0541 GMT, and West Texas Intermediate (WTI) crude dropped 39 cents, or 0.9%, to $41.53.

Oil prices rose by nearly $ 1 the day before, reaching their highest level since March 6.

Crude oil hit the wall due to the sharp increase in inventories, and warnings that the outbreak would worsen.

The U.S. will release official oil data later Wednesday.

The U.S. reported more than 1000 deaths from COVID-19 on Tuesday, for the first time since June 10 the country has surpassed this terrible point.

Economic data from Japan, the world’s fourth largest oil consumer, also had an impact on prices.

Oil prices rose on Tuesday with optimism news of the COVID-19 vaccine. The European Union agreed to provide 750 billion euro ($ 859 billion) funds to support coronavirus-damaged economies.

However, analysts say that it may take months for this funding to begin and that it may take years to see its impact on oil prices.

There are signs that Iraq, the second largest producer of the Organization of the Petroleum Exporting Countries (OPEC), has still not reached its target under the OPEC-led supply cut deal.

Meanwhile, according to a supportive statement of oil prices, compared to 1-10 July Russia plans to reduce its oil loads  of the Baltic and Novorossiyk ports between 1-10 August by approximately a quarter.

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