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Renewed fears of a demand recovery cause oil prices to fall

Oil prices

Oil prices have fallen in light of renewed concerns about the recovery in demand, with the imposition of new measures to confront the outbreak of the Coronavirus pandemic.

In early Asian trading, Brent crude fell 45 cents, or 0.6% percent, to $71.80 a barrel, after rising 1.7 percent yesterday.

US crude fell 55 cents, or 0.8 percent, to $67.81 a barrel, after rising 1.2 percent in the previous trading session.

Oil prices

The outbreak of new delta variant of coronavirus infections is raising concerns about the strength of the global economic recovery, hurting demand for oil and other commodities.

US oil stocks fell 3 million barrels last week to 432.6 million barrels, the lowest level since January 2020, exceeding the average forecast in a Reuters survey, which indicated a decrease of 2.7 million barrels.

In a related context, oil prices rose more than 5 percent yesterday, after a full week of consecutive losses due to the outbreak of the delta variant of the Coronavirus.

The international benchmark Brent crude contracts rose $3.27, or 5 percent, to $68.48 a barrel, last night.

Oil prices fell in the last session to their lowest level since last May, at the level of 64.6.

US West Texas Intermediate crude contracts jumped $4.31, or 5.3 percent, to $65.35 a barrel.

Both benchmarks recorded their biggest weekly loss in more than nine months last week, with Brent dropping about 8 percent and West Texas Intermediate crude down about 9 percent.

The rises at the beginning of this week are due to optimism about the ability of demand to overcome the crisis of the spread of the virus, especially with the adherence of many European countries and the United States to avoiding the strict closure restrictions.

Also supporting the gains, investors sought to snap deals after prices fell sharply in previous transactions, in addition to expectations that the OPEC+ alliance would postpone the monthly increase in oil supplies to provide some support to prices and avoid oversupply in the markets.

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