Oil prices ease on dim economic outlook despite signs of firmer demand

By Jane Chung SEOUL (Reuters) - Oil prices dipped on Wednesday as concerns over the lasting economic fallout from the coronavirus pandemic outweighed signs of improving demand and production cuts by major oil producers.

Reuters May 20, 2020 07:05:27 IST
Oil prices ease on dim economic outlook despite signs of firmer demand

Oil prices ease on dim economic outlook despite signs of firmer demand

By Jane Chung

SEOUL (Reuters) - Oil prices dipped on Wednesday as concerns over the lasting economic fallout from the coronavirus pandemic outweighed signs of improving demand and production cuts by major oil producers.

Brent crude futures for July delivery were trading down 11 cents, or 0.3%, at $34.54 per barrel at 0031 GMT.

U.S. West Texas Intermediate (WTI) crude futures for July were down 13 cents, or 0.4%, at $31.83 a barrel. The July contract became the front month after WTI futures for June expired on Tuesday, avoiding the chaos of last month's May expiry when prices slid into negative territory.

Oil prices have risen in the past three weeks, with both benchmarks climbing to above $30 for the first time in more than a month on Monday, supported by massive output cuts by major oil producers and signs of improving demand.

However, a bleak economic outlook from the U.S. Federal Reserve put downward pressure on oil prices.

U.S. Federal Reserve Chair Jerome Powell said on Tuesday layoffs by state and local governments will slow the U.S. economic recovery, while Boston Federal Reserve Bank President Eric Rosengren said the U.S. unemployment rate is likely to stay at double-digit levels by year-end.

"Crude oil prices gave up earlier gains amid concerns about the long-lasting economic damage the coronavirus has caused," ANZ Research said in a note.

U.S. crude inventories fell by 4.8 million barrels to 521.3 million barrels in the week to May 15, data from industry group the American Petroleum Institute (API) showed on Tuesday.

Official data from the Energy Information Administration (EIA) is due at 10:30 a.m. (1430 GMT) on Wednesday. [API/S]

Reflecting a slow return of demand, Asia's gasoline profit margins turned positive on Tuesday for the first in nearly two months, giving hope to global oil refiners.

(Reporting By Jane Chung; editing by Richard Pullin)

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

Updated Date:

TAGS:

also read

Guinea president 'captured', govt dissolved, claim army putschists'; attack on presidential palace repulsed, say authorities
World

Guinea president 'captured', govt dissolved, claim army putschists'; attack on presidential palace repulsed, say authorities

Reports suggest that they captured President Alpha Conde and dissolved the government, bust the ground situation remains unclear

Cryptocurrency prices tumble and exchange trading falters as snags crop up
News & Analysis

Cryptocurrency prices tumble and exchange trading falters as snags crop up

NEW YORK (Reuters) -The price of cryptocurrencies plunged and crypto trading was delayed on Tuesday, a day in which El Salvador ran into snags as the first country to adopt bitcoin as legal tender. Shares of blockchain-related firms also fell as crypto stocks were hit by trading platform outages. But the major focus was on El Salvador, where the government had to temporarily unplug a digital wallet to cope with demand.

Ford poaches Apple's car project chief Doug Field
News & Analysis

Ford poaches Apple's car project chief Doug Field

By Joseph White and Sanjana Shivdas (Reuters) -The head of Apple Inc's car project, Doug Field, is going to work for Ford Motor Co to lead the automaker's advanced technology and embedded systems efforts, a hiring coup for Ford Chief Executive Jim Farley.