Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Oil slips on U.S.-China tensions, rising virus cases

Published 07/26/2020, 09:13 PM
Updated 07/27/2020, 06:40 AM
© Reuters. FILE PHOTO: An oil pump jack pumps oil in a field near Calgary

© Reuters. FILE PHOTO: An oil pump jack pumps oil in a field near Calgary

By Florence Tan and Dmitry Zhdannikov

SINGAPORE/LONDON (Reuters) - Oil prices edged lower on Monday as rising coronavirus cases and tensions between the United States and China pushed investors towards safe-haven assets.

Brent crude (LCOc1) dipped 20 cents, or 0.5%, to $43.14 a barrel by 1000 GMT, while U.S. West Texas Intermediate (WTI) crude (CLc1) dropped to $41.15 a barrel, down 14 cents, or 0.4%.

The fall in oil mirrored moves in broader financial markets in Asia amid concerns about escalating tensions between the world's two biggest economies following the closures of consulates in Houston and Chengdu. Global coronavirus cases, meanwhile, exceeded 16 million.

Still, Brent is on track for a fourth straight monthly gain in July and WTI is set to rise for a third month as unprecedented supply cuts from the Organization of the Petroleum Exporting Countries and its allies including Russia propped up prices. Output has also fallen in the United States.

Oil demand has improved from the deep trough of the second quarter, although the recovery path is uneven as resumption of lockdowns in the United States and other parts of the world is capping consumption.

"Oil appears to be caught between opposing forces, crushing price volatility and ranges," said Jeffrey Halley, OANDA's senior market analyst for Asia Pacific.

Investors are also watching for any impact from storm Hanna, which battered the Texas coast over the weekend. Oil producers and refiners said on Friday that they did not expect the storm to affect operations.

The rebound in oil prices from lows hit earlier this year has also encouraged the world's top producers to increase output. The U.S. oil rig count rose last week for the first week since March.

© Reuters. Crude oil storage tanks are seen in an aerial photograph at the Cushing oil hub

"Whilst we believe rig activity has bottomed, we don't expect to see a quick recovery anytime soon at current price levels," ING analysts said in a note.

Latest comments

Reuters always win.
Geez you make sound like a 5% drop
Oil slips..? Gold is at all time highs wheres the 'Gold Glory' headlines..
Sure it's not the demand destruction from shutting down global economy?
Reuters are the same as CNN now...fake news
You should get out under that rock.
why are you here then?
Futures are up also. So how much of this .... can stomach and believe...none.
Lol. Oil is up
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.