Crude steady as rising European COVID-19 cases offset U.S. oil stock draw

By Scott DiSavino NEW YORK (Reuters) - Oil prices held steady on Thursday as a new wave of coronavirus cases in Europe led several countries to reimpose travel restrictions, offsetting a bullish drop in U.S.

Reuters September 25, 2020 00:06:27 IST
Crude steady as rising European COVID-19 cases offset U.S. oil stock draw

COVID-19 cases offset U.S. oil stock draw" src="https://images.firstpost.com/wp-content/uploads/reuters/09-2020/25/2020-09-24T023142Z_1_LYNXNPEG8N03P_RTROPTP_2_GLOBAL-OIL.jpg" alt="Crude steady as rising European COVID19 cases offset US oil stock draw" width="300" height="225" />

By Scott DiSavino

NEW YORK (Reuters) - Oil prices held steady on Thursday as a new wave of coronavirus cases in Europe led several countries to reimpose travel restrictions, offsetting a bullish drop in U.S. crude and fuel inventories.

Brent futures rose 16 cents, or 0.4%, to $41.93 a barrel by 2:02 p.m. EDT (1802 GMT), while U.S. West Texas Intermediate (WTI) crude rose 37 cents, or 0.9%, to $40.30.

That puts the premium of Brent over WTI on track for its smallest closing level since late May when WTI settled higher than Brent on one day.

On Wednesday, prices climbed slightly after government data showed U.S. oil inventories fell last week. [EIA/S]

Still, U.S. fuel demand is subdued as the pandemic limits travel. The four-week average gasoline demand last week was down 9% from a year earlier, government data showed.

"Oil prices (are) stable for now but downside pressure remains ... due to rising COVID numbers across Europe," said Craig Erlam, senior analysts at OANDA.

Britain, Germany and France imposed new restrictions to stem the coronavirus spread - all factors affecting fuel demand. [nL5N2GL2PW]

Prices were also capped by data showing the number of Americans filing new claims for unemployment benefits unexpectedly increased last week, supporting views the economic recovery from the COVID-19 pandemic was running out of steam amid diminishing government funding.

On the supply side, the market remains wary of a resumption of exports from Libya, although it is unclear how quickly it can ramp up volumes.

An oil tanker was loading a crude cargo on Thursday from one of three recently reopened Libyan terminals, with more loadings expected over the coming days.

A senior executive at U.S. oil producer ConocoPhillips , meanwhile, said the company sees global demand returning to 100 million barrels per day and growing from there.

(Additional reporting by Ahmad Ghaddar in London, Sonali Paul in Melbourne and Koustav Samanta in Singapore; Editing by Marguerita Choy and Barbara Lewis)

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