On Monday, oil prices inched lower on the rising coronavirus cases, shading the hopes for a smooth fuel demand recovery and drives crude oil on the way to the first monthly fall in many months.
By 00.03 GMT, Brent crude oil futures slipped by 0.2% or 8 cents to USD41.84/barrel, following the 2% fall in the previous week. US WTI edged down by 0.3% or 13 cents after declining by 2.1% last week.
Brent is set to post a monthly fall for the first time in six months while WTI is about to post its monthly drop in five months.
ANZ analysts noted that the new coronavirus cases in major US states have renewed the challenges for oil demand recovery in the last quarter.
Other than that, two notable producers of the Organization of Petroleum Exporting Countries (OPEC), Iran and Libya, are seen to post more crude exports despite the OPEC and allies (OPEC+) output cut pact.
However, OPEC Secretary-General Mohammad Barkindo reignited positivity that the commercial oil stockpiles in Organisation for Economic Co-operation and Development (OECD) countries would stand only slightly above the five-year average in the first quarter of 2021, before falling below that level for the rest of the year.
Other factors cushioning the fall of oil prices would be the possibility of an oil workers’ strike in Norway on September 30, which would likely slash output by 900,000 bpd of the country’s production, and the security issues in South Caucasus, a corridor for pipelines carrying oil and gas to world markets, due to clashes between Armenia and Azerbaijan over the weekend.
