Oil slips below $44, heads for weekly drop on demand concerns

A man walks on a path in front of an oil derrick near the Huntington Beach Oil Fields on April 20, 2020 in Huntington Beach, California. Michael Heiman | Getty Images Oil slipped below $44 a barrel on Friday and was on course for its biggest weekly decline since June […]

A man walks on a path in front of an oil derrick near the Huntington Beach Oil Fields on April 20, 2020 in Huntington Beach, California.

Michael Heiman | Getty Images

Oil slipped below $44 a barrel on Friday and was on course for its biggest weekly decline since June as weak demand figures added to concern over a slow recovery from the COVID-19 pandemic.

A U.S. government report showed that domestic gasoline demand fell in the latest week. Middle distillates inventories at Asia’s Singapore oil hub have soared above a nine-year high, official data showed..

Brent crude, the international benchmark, fell 41 cents, or 0.9%, to $43.66, heading for a 3% drop this week. West Texas Intermediate slipped 41 cents, or 1%, to $40.96, set for its first weekly drop in five.

“The bigger market picture is overall bearish sentiment that kicked off with lower gasoline demand reports on Wednesday,” said Paola Rodriguez-Masiu, analyst at Rystad Energy.

Oil reversed earlier gains in reaction to the U.S. dollar gaining soon after the U.S. nonfarm payrolls report showed the unemployment rate fell to 8.4%. A strong dollar makes oil more expensive to other currency holders and tends to weigh on oil prices.

“Crude prices can’t shake off the strong dollar that emerged from a strong employment report,” said Edward Moya, analyst at brokerage OANDA.

Oil has recovered since April, when Brent slumped to a 21-year low below $16 and U.S. crude briefly went into negative territory.

A record supply cut since May by the Organization of the Petroleum Exporting Countries (OPEC) and its allies, a group known as OPEC+, has supported prices.

OPEC began in August to ease the scale of the cuts, raising output by almost 1 million barrels per day according to a Reuters survey.

Source Article

Next Post

Surge in Insurance Inquiry surveys

Our Insurance Inquiry has attracted a huge public response, with more than 700 surveys completed by small businesses so far. Small businesses have until Sunday (30 August, 2020) to share their experiences with insurance providers by completing the online survey. We’ve had an overwhelming response to this inquiry since we […]