Oil steadies but Europe pandemic outlook knocks demand hopes

Oil steadies but Europe pandemic outlook knocks demand hopes

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Tokyo: Oil prices rose slightly on Friday, but still fell by more than 8% this week. The reason is that a new round of COVID-19 infection in Europe has triggered a new lockdown and dampened hopes that the expected fuel demand will soon resume.

Due to concerns about a slowdown in European vaccination programs, prices plummeted 7% on Thursday, falling for the fifth consecutive day, even as the number of infections in the United States, the worst-hit country and the largest crude oil consumer plummeted.

At 0233 GMT, US crude oil rose 10 cents, or 0.2%, to $60.10 per barrel. Brent crude oil rose 18 cents, or 0.3%, to $63.46 per barrel.

In a report to customers, ING Economics said: “The market is becoming more and more tense in some European countries, which once again imposes restrictions on COVID-19, which raises concerns about the outlook for demand.”

With the increase in new infections, several major European countries have recommended lockdowns, and vaccination plans have slowed down due to concerns about the side effects of the AstraZeneca vaccine widely distributed in Europe.

Since the regulatory agency announced the safety of AstraZeneca’s vaccine, Germany, France and other countries have announced the resumption of vaccination, but the termination of the program has made it more difficult to overcome resistance to the vaccine in certain populations.

The increase in COVID-19 cases, especially in Brazil, has also put pressure on the demand outlook, and a stronger U.S. dollar has also put pressure on oil prices.

According to data from the Joint Organizations Data Initiative website, oil supplies are also abundant. In January, Saudi Arabia’s crude oil exports increased for the seventh consecutive month, reaching the highest level since April 2020.

In January, the world’s largest oil exporter’s shipments increased from 6.495 million barrels in the previous month to 6.582 million barrels per day.

According to official data released on Wednesday, US crude oil inventories increased for the fifth consecutive week last week.

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