Oil prices fall on virus worries; U.S. stock draw, China data check losses

A TORC Oil & Gas pump jack is seen near Granum, Alberta, Canada, May 6, 2020. (Reuters)

SULAIMANI (ESTA) — Oil prices fell on Thursday as mounting coronavirus cases globally raised demand concerns, although a drawdown in U.S. crude stock for a fifth straight week and robust date from China capped losses.

Brent crude oil futures fell 14 cents to $55.92 a barrel at 0606, while U.S. West Texas Intermediate (WTI) slipped by 4 cents to $52.87 a barrel.

“Oil market’s sizzling rally likely took a hiatus as the stronger dollar and the omnipresent gasoline supply overhang offset the evaporating U.S. crude inventories,” Reuters quoted Stephen Innes, chief global market strategist at Axi, as saying.

U.S. crude oil stockpiles last week fell more than expected, while gasoline and distillate inventories rose as refiners ramped up output to its highest level since August, according to the Energy Information Administration (EIA).

China, the world’s second largest oil consumer, reported its biggest daily jump in new COVID-19 cases in more than 10 months as infections in northeastern Heilongjiang province nearly tripled, underscoring the growing threat ahead of a major national holiday.

Governments across Europe announced tighter and longer coronavirus lockdowns on Wednesday due to a fast-spreading COVID variant first detected in Britain and as vaccinations are not expected to help much for another two to three months.

Reuters cited an IEA official as saying oil producers face an unprecedented challenge to balance supply and demand as factors including the pace and response to COVID-19 vaccines cloud the outlook.

(Esta Media Network/Reuters)

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