SULAIMANI (ESTA) — Oil prices fell on Wednesday, weighed down by concerns that surging coronavirus cases in India will drive down fuel demand in the world’s third-biggest oil importer.
Brent crude futures for June fell 18 cents to $66.39 a barrel at 0805 GMT, after dropping 48 cents on Tuesday. U.S. West Texas Intermediate (WTI) crude futures for June fell 22 cents to $62.45 per barrel.
“India is a major crude oil consumer. So rising virus cases and thereby restrictions to limit the spread will dampen the demand outlook,” Reuters quoted vice president for commodities at Kotak Securities Ravindra Rao as saying.
“Global crude markets remain well supplied with OPEC and its allies scheduled to hike production in coming months. So, if the demand picture does not improve significantly, prices may correct further.”
India, also the world’s third-largest oil user, reported on Wednesday another record increase in the daily death toll from coronavirus, at 2,023, and another record rise in cases at more than 295,000, Reuters said.
“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, according to Reuters.
