Oil prices dipped on Monday as rising coronavirus cases upset hopes for a smooth recovery in fuel demand, with the main crude benchmarks on track for their first monthly falls in multiple months after last week’s slips. Brent crude fell 23 cents, or 0.6%, to $41.69 a barrel by 0243 GMT after dropping 2.9% last week.
U.S. West Texas Intermediate was at $40.04 a barrel, down 21 cents or 0.5%, following a 2.1% decline last week. Brent is on track to fall for the first month in six while WTI is headed for its first monthly loss since April as the reimposition of mobility curbs in some countries clouds the outlook on fuel demand recovery.
“New COVID-19 case numbers are accelerating in major U.S. states, renewing fears of mobility restrictions challenging the ongoing oil demand recovery in the last quarter,” ANZ analysts said in a note. More crude is also being exported from OPEC producers Iran and Libya despite efforts by the Organization of the Petroleum Exporting Countries and their allies to limit output. Last week, U.S. energy firms also added oil and natural gas
Stocks climb with futures; Dollar edges lower: Markets Wrap
Meanwhile, U.S. and European equity-index futures gained on Monday along with stocks in Asia as China’s ongoing economic recovery countered some of the concerns sparked by rising global coronavirus cases. The dollar dipped and the yen ticked up.
The Aussie rose after an influential economist walked back his call for an interest-rate cut to November from October. S&P 500 futures gained after the gauge advanced on Friday, while shares climbed in Seoul, Tokyo and Hong Kong. Euro Stoxx 50 contracts were up almost 2%. Crude oil slipped, while Treasuries were little changed. China Evergrande Group’s shares rose along with its bonds after the firm attempted to revive confidence in its finances. HSBC Holdings Plc advanced the most in Hong Kong trading since 2009 after the bank’s biggest shareholder added to its stake in the embattled lender.
Global equities remain on course for the first month of losses since March, amid mounting risks to the economic recovery from fresh coronavirus waves and stalling fiscal relief in the U.S. One of the brighter spots is China, where data over the weekend showed profits at industrial companies grew for a fourth consecutive month in August.