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Oil prices drop as rising U.S. coronavirus cases stoke fears of weak fuel demand

Published 15/06/2020, 01:36
Oil prices drop as rising U.S. coronavirus cases stoke fears of weak fuel demand
LCO
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SEOUL, June 15 (Reuters) - Oil prices fell on Monday, with
U.S. oil dropping more than 2%, as a spike in new coronavirus
cases in the United States raised concerns over a second wave of
the virus which would weigh on the pace of fuel demand recovery.
Brent crude LCOc1 futures fell 66 cents, or 1.7%, at
$38.07 a barrel as of 0016 GMT, while U.S. West Texas
Intermediate (WTI) crude CLc1 futures fell 81 cents, or 2.2%,
to $35.45 a barrel.
Both benchmarks ended down about 8% last week, their first
weekly declines since April, hit by the U.S. coronavirus
concerns: More than 25,000 new cases were reported on Saturday
alone as more states, including Florida and Texas, reported
record new infection highs. "Concerns about the recent uptick in COVID-19 infections in
the U.S. and a potential 'second wave' are weighing on oil at
the moment," said Stephen Innes, chief global market strategist
at AxiCorp.
Meanwhile, an OPEC-led monitoring panel will meet on
Thursday to discuss ongoing record production cuts to see
whether countries have delivered their share of the reductions,
but will not make any decision, according to five OPEC+ sources.
The Organization of the Petroleum Exporting Countries (OPEC)
and its allies, collectively known as OPEC+, have been reducing
supplies by 9.7 million barrels per day (bpd), about 10% of
pre-pandemic demand, and agreed in early June to extend the cuts
for a month until end-July. Iraq, one of the laggards in complying with the curbs,
agreed with its major oil companies to cut crude production
further in June, Iraqi officials working at the fields told
Reuters on Sunday.

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