Oil drops as new coronavirus variant revives demand fears

By Jessica Resnick-Ault NEW YORK (Reuters) -Oil dropped towards $50 a barrel on Tuesday, adding to losses from the previous session, as a mutant variant of the coronavirus in Britain revived concerns over demand recovery. Detection of the new variant prompted several countries to close their borders to Britain.

Reuters December 23, 2020 00:06:50 IST
Oil drops as new coronavirus variant revives demand fears

coronavirus variant revives demand fears" src="https://images.firstpost.com/wp-content/uploads/reuters/12-2020/23/2020-12-22T073820Z_2_LYNXMPEGBL03H_RTROPTP_2_GLOBAL-OIL.jpg" alt="Oil drops as new coronavirus variant revives demand fears" width="300" height="225" />

By Jessica Resnick-Ault

NEW YORK (Reuters) -Oil dropped towards $50 a barrel on Tuesday, adding to losses from the previous session, as a mutant variant of the coronavirus in Britain revived concerns over demand recovery.

Detection of the new variant prompted several countries to close their borders to Britain. The BBC cited France's Europe Minister as saying that the two countries would announce a deal to restart freight by Wednesday.

Brent crude was down 60 cents, or 1.2%, at $50.32 a barrel by 11:58 a.m. EST (1558 GMT), while U.S. West Texas Intermediate (WTI) crude fell 72 cents, or 1.5%, to $47.25.

Both benchmarks slid nearly 3% on Monday, partly erasing recent gains driven by the rollout of COVID-19 vaccines, seen as key to allowing a return to normal life.

The latest rally culminated in Brent hitting $52.48, its highest since March, on Friday. Prices have then come down amid concerns about the virus spreading. Some see potential for prices to fall further.

"The holiday malaise has set in on oil," said Phil Flynn, senior analyst at Price Futures Group in Chicago. "Now that we have stimulus done, and we still have concerns about the new strain of virus, people are heading to the sidelines," he said.

Oil gained support from U.S. Congress approval of a $892 billion coronavirus aid package after months of inaction.

In focus will be the latest U.S. oil inventory reports, expected to show crude stocks fell by 3.3 million barrels. The American Petroleum Institute's report is due at 2130 GMT.[EIA/S]

The Organization of the Petroleum Exporting Countries and allies, a group known as OPEC+, are set to boost output by 500,000 barrels per day in January. There is no sign yet of any wavering induced by the price drop.

Russian Deputy Prime Minister Alexander Novak on Monday said the rise in output should not result in a glut.

(Additional reporting by Sonali Paul in Melbourne and Koustav Samanta in Singapore and Alex Lawler in LondonEditing by Alexander Smith and Mark Potter)

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

UK reactivates emergency COVID-19 hospitals, closes London primary schools
World

UK reactivates emergency COVID-19 hospitals, closes London primary schools

By Kate Holton LONDON (Reuters) - Britain reactivated emergency hospitals built at the start of the pandemic and shut primary schools in London on Friday to counter the rapid spread of a much more infectious variant of the coronavirus. With more than 50,000 new daily cases of COVID-19 for the last four days, the health service said it was preparing for an anticipated rush of patients and needed more beds.

Romney floats sweeping vaccine plan as U.S. nears 20 million COVID-19 cases
World

Romney floats sweeping vaccine plan as U.S. nears 20 million COVID-19 cases

By Susan Heavey WASHINGTON (Reuters) - Senator Mitt Romney on Friday urged the U.S. government to immediately enlist veterinarians, combat medics and others in a sweeping proposal to administer coronavirus vaccinations and slow the rising death toll.

Suddenly overwhelmed, Ireland says thousands of COVID-19 cases yet to be added to tally
World

Suddenly overwhelmed, Ireland says thousands of COVID-19 cases yet to be added to tally

DUBLIN (Reuters) - Ireland said on Friday it had under-reported coronavirus cases in recent days by thousands more than previously known as its system came under strain, suggesting the EU's fastest growing outbreak is worsening even more rapidly than figures showed.