Oil dips on pandemic lockdown worries even though OPEC+ may tighten supply

By Scott DiSavino NEW YORK (Reuters) - Oil prices slipped on Tuesday as worries that lockdowns to fight a new surge in coronavirus cases could hit short-term demand outweighed hopes for a vaccine and the possibility of tighter OPEC+ supply policies. Brent futures fell 33 cents, or 0.8%, to $43.49 a barrel by 12:19 p.m.

Reuters November 18, 2020 00:06:16 IST
Oil dips on pandemic lockdown worries even though OPEC+ may tighten supply

Oil dips on pandemic lockdown worries even though OPEC may tighten supply

By Scott DiSavino

NEW YORK (Reuters) - Oil prices slipped on Tuesday as worries that lockdowns to fight a new surge in coronavirus cases could hit short-term demand outweighed hopes for a vaccine and the possibility of tighter OPEC+ supply policies.

Brent futures fell 33 cents, or 0.8%, to $43.49 a barrel by 12:19 p.m. EST (1719 GMT), while U.S. crude fell 23 cents, or 0.6%, to $41.11.

"Concerns of more lockdowns are hurting near-term demand expectations," said Phil Flynn, senior analyst at Price Futures Group in Chicago, noting the market was balancing those concerns against prospects that a vaccine will allow oil demand to return to normal.

On Monday, Brent closed at a 10-week high following Moderna Inc's announcement that its coronavirus vaccine was 94.5% effective. That followed last week's news from Pfizer Inc that its vaccine was more than 90% effective.

But the short-term economic outlook remains hazy with several European nations tightening restrictions as coronavirus cases increase.

To tackle weaker energy demand, Saudi Arabia called on fellow OPEC+ members on Tuesday to be flexible in responding to oil market needs as it builds the case for a tighter oil production policy in 2021.

OPEC+, which groups the Organization of the Petroleum Exporting Countries (OPEC), Russia and others, lowered its outlook on oil demand growth for 2021, according to a confidential document seen by Reuters.

OPEC+ held a ministerial committee meeting on Tuesday that made no formal recommendation. The group will hold a full meeting on Nov. 30-Dec. 1.

An option gaining support among OPEC+ nations is to keep the existing cuts of 7.7 million barrels per day (bpd) for a further three to six months, sources said, rather than tapering the reduction to 5.7 million bpd in January.

Graphic: OPEC+ Scenarios and Impact on Oil Inventories https://fingfx.thomsonreuters.com/gfx/ce/xklpybqkbvg/OPEC%20Scenarios.PNG

In the United States, meanwhile, analysts said crude inventories likely rose 2 million barrels during the week ended Nov. 13 after gaining 4.3 million barrels in the prior week, according to a Reuters poll.

The poll was conducted ahead of reports from the American Petroleum Institute (API) industry group at 4:30 p.m. EST on Tuesday and the U.S. Energy Information Administration on Wednesday.

(Additional reporting by Bozorgmehr Sharafedin in London and Jessica Jaganathan and Roslan Khasawneh in Singapore; Editing by Edmund Blair and Jason Neely)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.

also read

The forces fighting in Ethiopia's Tigray conflict
World

The forces fighting in Ethiopia's Tigray conflict

ADDIS ABABA/NAIROBI (Reuters) - Ethiopia's military is fighting battle-hardened troops in the northern Tigray region, threatening stability around the Horn of Africa. Here are some facts on the forces: THE NATIONAL MILITARY: THE ENDF The Ethiopian National Defence Force (ENDF) has around 140,000 active personnel, the vast majority of them in the army, according to the Janes security data group. Its troops have been tested by Islamist militants in Somalia and rebel groups in Ethiopia's border regions, as well as a two-year border war with Eritrea followed by an 18-year standoff that only ended in 2018.

Turkey to impose measures to combat coronavirus, Erdogan says
World

Turkey to impose measures to combat coronavirus, Erdogan says

ISTANBUL (Reuters) - Turkey's President Tayyip Erdogan said on Tuesday that the government will impose tighter measures to fight with the coronavirus and impose partial lockdowns on weekends across the country. Speaking after the cabinet meeting, Erdogan also said all schools will remain closed until the year-end and all restaurants will only work by delivery

Brazil to track illegal Amazon wood exports using isotopes, president says
World

Brazil to track illegal Amazon wood exports using isotopes, president says

BRASILIA (Reuters) - Brazilian President Jair Bolsonaro said on Tuesday his government in coming days will name countries that are importing wood illegally extracted from the Amazon. Addressing a BRICS summit of big developing economies, Bolsonaro said Brazilian police had developed a way of tracking wood exported from the Amazon using isotopes.