By Sonali Paul
MELBOURNE, April 21 (Reuters) - Oil prices fell for a second
day on Wednesday on concerns that soaring COVID-19 cases in
India will drive down fuel demand in the world's third biggest
oil importer.
Brent crude LCOc1 futures for June fell 52 cents, or 0.8%,
to $66.05 a barrel at 0157 GMT, after dropping 48 cents on
Tuesday.
U.S. West Texas Intermediate (WTI) crude CLc1 futures for
June fell 56 cents, or 0.9%, to $62.11 a barrel. The May
contract expired on Tuesday down 1.5% at $62.44.
"You've seen refiners there (in India) scale back runs
because demand has fallen with the spread of lockdowns. That's
clearly weighing on the market and sentiment," said Lachlan
Shaw, head of commodity research at National Australia Bank .
India, also the world's third-largest oil user, on Tuesday
reported its worst daily death toll from COVID-19 and is facing
an oxygen supply crisis to treat patients. Large parts of the
country are now under lockdown due to a huge second wave of the
pandemic. Further weighing on the market, data from the American
Petroleum Institute (API) industry group showed U.S. crude oil
and distillate stocks rose in the week ended April 16, according
to two market sources, compared with analysts' forecasts for
declines in crude and distillate inventories. Crude stocks rose by 436,000 barrels, API reported,
according to the sources. Analysts polled by Reuters had
expected a 3 million bbl drawdown in crude stocks. Distillate stocks, which include diesel, heating oil and jet
fuel, rose by 655,000 barrels, compared with analysts' forecasts
for a 1 million barrel decline.
The U.S. Energy Information Administration will release its
inventory data for last week later on Wednesday.
Analysts said despite the pandemic hotspots in places like
India and growing concerns in Japan, the world's fourth-biggest
oil user, signs are still positive for a fuel demand recovery in
the United States, UK and Europe.
"Driving is soaring in the UK as the vaccine rollout
accelerates. Such is also the case in the US, where drivers
consume over 10% of the world's oil," ANZ analysts said in a
note.