UPDATE 8-Oil sinks on weak U.S. economic data, political uncertainty

* Surging COVID-19 cases dent fuel demand outlook
* U.S. economy contracts at steepest rate since Great
Depression

(Updates to settlement, adds analysts quotes)
By Laura Sanicola
NEW YORK, July 30 (Reuters) - Oil prices sank on Thursday
following poor U.S. economic figures and after U.S. President
Donald Trump roiled markets with a suggestion that the nation
should delay its November presidential election.
Investors sold riskier assets following Trump's tweet that
raised the prospect of delaying the vote. The date of the U.S.
election is enshrined in the U.S. Constitution, but Trump's
remarks were viewed as an attack on the integrity of the coming
election, worrying investors. Oil markets recovered from their lowest levels of the
selloff. U.S. West Texas Intermediate (WTI) crude CLc1 futures
settled down $1.35, or 3.3%, at $39.92 a barrel after falling 5%
earlier in the session.
Brent crude futures LCOc1 , which expire on Friday, fell 81
cents, or 1.9%, to $42.94 a barrel.
"We have the potential for serious political uncertainty in
the U.S. if election dates are challenged," said John Kilduff,
partner at Again Capital in New York.
In a sign of the devastating impact of the coronavirus on
the United States, the world's biggest oil consumer, the
country's economy contracted at its steepest pace since the
Great Depression in the second quarter.
U.S. gross domestic product collapsed at a 32.9% annualised
rate, the deepest decline in output since the government started
keeping records in 1947. In addition, weekly jobless claims
rose, a signal that the worsening outbreaks across wide swathes
of the United States are taking a further toll on the economy.
Deaths from COVID-19 have now topped 150,000 in the United
States, while Brazil, with the world's second-worst outbreak,
set daily records of confirmed cases and deaths. New infections
in Australia hit a record on Thursday. The potential threat to a recovery in oil demand comes as
the Organization of the Petroleum Exporting Countries (OPEC) and
its allies, together known as OPEC+, are set to step up output
in August, adding about 1.5 million barrels per day to global
supply.
"The market is now watching U.S. producers and OPEC+
consider plans to ramp up while demand isn't returning the way
we thought it would a few weeks ago...the supply demand balance
could get out of whack" said Gene McGillian, vice president of
market research at Tradition Energy.