Wed, 23 Sep 2020

Oil prices fall amid demand worries

Xinhua
07 Aug 2020, 07:05 GMT+10

NEW YORK, Aug. 6 (Xinhua) -- Oil prices declined on Thursday as pandemic-propelled demand concerns returned to the market.

The West Texas Intermediate for September delivery lost 24 cents to settle at 41.95 U.S. dollars a barrel on the New York Mercantile Exchange, while Brent crude for October delivery slipped 8 cents to close at 45.09 dollars a barrel on the London ICE Futures Exchange.

The moves followed a 4-day winning streak on the oil market.

"Prices are being lent buoyancy first and foremost by significantly better investor sentiment: the market is therefore deaf in one ear and listening almost solely to price-supportive news," Eugen Weinberg, energy analyst at Commerzbank Research, said in a note on Thursday, commenting on the recent market movement.

"In the medium term, the weak demand is likely to weigh more heavily than the positive sentiment, which is why we expect prices to correct in the near future," he said, adding that major oil producers' decision to roll back the production cuts "was premature."

Last month, the Organization of the Petroleum Exporting Countries (OPEC) and its allies, known as OPEC+, decided to scale back their record production cuts to 7.7 million barrels per day starting from August.

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