Oil falls to two-week low on U.S. inventory shock, COVID-19 case rise
Oil prices slumped to their lowest in two weeks after official figures showed a surprise jump in U.S. inventories of crude, and rising cases of COVID-19 in Europe, Russia, and some outbreaks of infections in China dented hopes for an economic recovery.
Brent crude dropped $1.58, or 1.9%, to $83.00 a barrel by 0502 GMT, having hit a two-week low of $82.32 earlier and fallen by 2.1% in the previous session.
Outbreaks of coronavirus infections in China and record deaths and the threat of lockdowns in Russia, along with rising cases in western Europe were putting the brakes on a multi-week rally in oil prices. read more
In the U.S., the economy likely grew at the slowest rate in more than twelve months in the June-September quarter amid a resurgence of COVID-19 infections, amid strained global supply chains and global shortages of goods like autos. read more
The “hefty” stock build came “on the back of a large jump in net imports of crude oil and still sluggish refinery processing,” Citi Research commodities analysts said in a note.
At the WTI delivery hub in Cushing, Oklahoma, crude storage is the most depleted in three years, with prices for longer-dated futures contracts indicating supplies will stay low for months.
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