Oil prices down with record new COVID-19 cases in US
WORLD ECONOMY

Oil prices down with record new COVID-19 cases in US

Record number of new cases in world's biggest oil consumer indicates that oil demand is likely to remain low in 3rd quarter

News Service AA

Crude oil prices were down on Friday with new novel coronavirus (COVID-19) cases in the US breaking a single-day record while weakening the oil demand outlook in the country.

International benchmark Brent crude was trading at $42.80 per barrel at 0654 GMT for a 0.78% decline after closing Thursday at $43.14 a barrel.

American benchmark West Texas Intermediate (WTI) was at $40.28 a barrel at the same time for a 0.91% loss after ending the previous day at $40.65 per barrel.

There were a total of 54,357 new coronavirus cases in the US on Wednesday, according to the country's Centers for Disease Control and Prevention (CDC) on Thursday. This marked the highest single-day new COVID-19 cases in the US.

The record number of new cases in the world's biggest oil-consuming nation indicates that its oil demand is likely to remain low in the third quarter of 2020, keeping downward pressure on prices.

On the demand side, however, the number of oil rigs in the US -- an indicator of short-term crude production -- has fallen for sixteenth consecutive weeks to take the oil rig count to its lowest level since June 2009, according to oilfield services company Baker Hughes on Thursday.

This signals that US crude oil production could remain weak in the following weeks by helping to trim some of the glut of supply in the global oil market and relieve some of the pressure on crude prices.

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