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Oil falls in biggest weekly decline in months on demand worries

CommoditiesAug 06, 2021 04:26PM ET
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2/2 © Reuters. FILE PHOTO: A gas pump is seen hanging from the ceiling at a petrol station in Seoul June 27, 2011. REUTERS/Jo Yong-Hak 2/2

By Laura Sanicola

NEW YORK (Reuters) -Oil prices fell about 1% lower on Friday, posting to their steepest weekly losses in months, on worries that travel restrictions to curb the spread of the Delta variant of COVID-19 will derail the global recovery in energy demand.

Crude futures also came under pressure as the dollar strengthened after monthly U.S. job growth came in higher than expected. A stronger dollar makes greenback-denominated oil more expensive for buyers in other currencies.

Brent crude oil futures settled down 59 cents, or 0.8%, at $70.70, while U.S. West Texas Intermediate (WTI) crude futures fell 81, or 1.2%, to settle at $68.28 a barrel.

For the week, global benchmark Brent shed more than 6%, its largest week of losses in four months, and WTI tumbled nearly 7% in its biggest weekly decline in nine months.

"The price action we see now is really a function of the macro picture," said Howie Lee, an economist at Singapore bank OCBC. "The Delta variant is now really starting to hit home and you see risk aversion in many markets, not just oil."

U.S. President Joe Biden said that COVID-19 cases in the United States, which have climbed to a six-month high, will go up before they come down and that the new Delta variant is taking a needless toll on the country.

Japan is poised to expand emergency restrictions to more regions of the country, while China, the world's second-largest oil consumer, has imposed curbs in some cities and canceled flights.

"Increased travel restrictions in China have come under the microscope of traders and could become a key oil price mover as this month proceeds," said Jim Ritterbusch, president of Ritterbusch and Associates LLC in Galena, Illinois.

U.S. oil rigs rose two to 387 this week, energy services firm Baker Hughes Co said. Growth in the rig count has slowed in recent months as drillers continue to focus on capital discipline.

(Additional reporting from Noah Browning Dmitry ZhdannikovEditing by Marguerita Choy and David Gregorio)

Oil falls in biggest weekly decline in months on demand worries
 

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Comments (5)
Shafiqur Mazumdar
Shafiqur Mazumdar Aug 08, 2021 7:06AM ET
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Oil demand world wide low down due to covid -19. It will low down import. will the drilling come down according to demand or price will remain due to increase of stock by importing countries?
Alan Rice
Alan Rice Aug 07, 2021 2:39PM ET
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World oil glut continues, day 36,021. Road Trip !!
Bill Ackman
Bill Ackman Aug 06, 2021 4:45PM ET
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Oil is going much higher…These short speculators will lose everything soon
Edward Chong
Edward Chong Aug 06, 2021 4:45PM ET
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i think u better pray harder cos brent is cracking soon.
Bill Ackman
Bill Ackman Aug 06, 2021 4:45PM ET
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Edward Chong I dont have to fo anything…Dollar printing and losing value will do it
Master King gaming
Master King gaming Aug 06, 2021 8:10AM ET
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Kamlesh Mukhiya
Kamlesh Mukhiya Aug 06, 2021 8:10AM ET
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Hii
Robert Cutler
Robert Cutler Aug 05, 2021 9:46PM ET
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Anybody notice the price of crude is stuck around Putin's age
Angus Malarkey
Angus Malarkey Aug 05, 2021 9:46PM ET
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it's actually Biden's iq
Shahid Mahmood
Shahid Mahmood Aug 05, 2021 9:46PM ET
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MBS going 36 on 31st August Any chance of crude celebration with that No ...? 🤣
Louis Moore Bacon
Louis Moore Bacon Aug 05, 2021 9:46PM ET
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Which is double the IQ of the orange baboon. And I’m being nice.
 
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