Oil falls as possible OPEC+ supply boost, COVID-19 spike weigh on sentiment

TOKYO, Oct 16 (Reuters) - Oil prices fell on Friday on
concerns that major producers will move ahead with plans to ease
their supply cuts even as a spike in COVID-19 cases in Europe
and the United States is curtailing demand in two of the world's
biggest fuel consuming regions.
Brent crude futures for December LCOc1 dropped 22 cents,
or 0.5%, to $42.94 a barrel by 0154 GMT, while U.S. West Texas
Intermediate (WTI) crude futures for November delivery CLc1
slid 16 cents, or 0.4%, to $40.8 a barrel.
Both benchmarks fell slightly the previous day; however,
they are headed for small gains for the week.
A technical committee of the Organization of the Petroleum
Exporting Countries (OPEC) and allied oil producers, a group
know as OPEC+, ended a meeting on Thursday expressing concerns
about rising oil supply as social restrictions to curb the
spread of COVID-19 limit fuel usage. OPEC+ is set to reduce its current supply cuts of 7.7
million barrels per day (bpd) by 2 million bpd in January even
as OPEC Secretary General Mohammed Barkindo admits fuel demand
is looking "anaemic." The bearish demand outlook and rising supply from Libya may
mean OPEC+ could roll over the existing cuts into next year,
OPEC+ sources said on Thursday.
There is an OPEC+ meeting scheduled for Nov. 30 to Dec. 1 to
set policy.
"All eyes are on OPEC+ move from January," said Hiroyuki
Kikukawa, general manager of research at Nissan Securities.
"Still, a resurgence in coronavirus infections in Europe and
some parts in the United States raised fears over weaker fuel
demand, weighing on the market sentiment," Kikukawa said.
In Europe, some countries were reviving curfews and
lockdowns to fight a surge in new coronavirus cases, with
Britain imposing tougher COVID-19 restrictions in London on
Friday. Pandemic cases have surged in the U.S. Midwest and beyond,
with new infections and hospitalizations rising to record levels
in an ominous sign of a nationwide resurgence as temperatures
get colder. "With uncertainty over OPEC+ future policy and the U.S.
presidential election, the oil prices will likely remain in a
tight range for a while," Kikukawa said.