(Bloomberg) -- Oil edged higher after a three-day slide that was driven by the growing threat to demand from the spread of the delta coronavirus variant.
West Texas Intermediate gained 0.4% in Asian trading after losing almost 3% over the previous three sessions. U.S. gasoline consumption fell for a third week, according to a survey by Descartes (NASDAQ:DSGX) Labs, while data from China revealed a slowdown in economic activity in the world’s biggest oil importer in July.
After a blistering rally in the first half, crude’s advance has been checked in July and August. The delta variant has spurred fresh curbs on mobility in many nations including China, harming energy consumption. Against that backdrop, JPMorgan Chase & Co. (NYSE:JPM) has been among bank’s reducing oil price forecasts.
While demand has been challenged, the Organization of Petroleum Exporting Countries and its allies have stayed the course in relaxing the output curbs imposed in the early phase of the pandemic. Daily supplies will rise by 400,000 barrels a day this month. The group will meet Sept. 1 to review the market.
Crude’s decline on Monday reflected concerns over the impact of delta on demand, according to Goldman Sachs Group Inc (NYSE:GS). Still, that challenge would be transient and the bank said it was standing by a forecast for Brent to hit $80 a barrel next quarter amid a sustained deficit, according to an Aug. 16 note.
Brent’s prompt time spread was steady at 37 cents a barrel in backwardation. While that’s a bullish pattern -- with near-dated prices above those further out -- it is down from 62 cents about a month ago on July 16.
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