Oil prices fell around 3% on the week on fears of more economic disruptions as Covid-19’s rampage continues to devastate the United States and the world.
Also weighing on crude was data from earlier in the week showing the first jump in U.S. output in three months, despite demand for fuel remaining fledgling at best.
While the latest weekly reading for the U.S. oil rig count posted on Friday barely showed a change, few had doubts that the near quadrupling of crude prices since April had prompted drillers in shale patches to turn the spigots back on and restore some wells shut at the height of the pandemic.
“The oil demand recovery story has been dealt a blow with the U.S. registering the biggest-ever jump in coronavirus cases, suggesting many states may have to revisit regional lockdowns soon,” said Ed Moya, analyst at New York-based online trading platform OANDA.
“The rapid demand rebound is not happening, but stimulus efforts, pauses in reopening of businesses and improved treatments for the virus are limiting the downward pressure on crude. States will do their best to avoid a complete reversal with reopening phases, so the economic recovery should not completely stall out.”
Last updated on Sat., June 27, 2020.