Oil price falls, as rising COVID-19 infections threaten demand

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Oil prices slipped on Thursday after an unexpected rise in U.S. crude oil inventories and as rising COVID-19 infections threaten demand, but prices held on to most of their gains from the previous session on expectations that supplies will remain tight through year-end.

Brent crude fell 32 cents to $71.91 a barrel after rising 4.2% in the previous session while U.S. West Texas Intermediate crude fell 27 cents to $70.03 a barrel, after rising 4.6% on Wednesday.

With OPEC+, comprising the Organization of the Petroleum Exporting Countries and allies like Russia, unlikely to get the market soon and Iranian negotiations delayed, the most relevant risk to market fundamentals remains a deterioration of demand due to new virus restrictions.

Analysts say only a really tremendous demand shortfall would tip the market balance into a surplus.




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