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Brent crude fell 36 cents, or 0.7%, to $48.89 a barrel by 1112
GMT. U.S. crude was down 39 cents, or 0.8%, at $45.87.
"Surging virus cases and a Reuters report signalling the United
States is preparing new sanctions on Chinese officials ...
outweighed the positive sentiment driven by vaccine news," said
Hussein Sayed, chief market strategist at FXTM.
Reuters exclusively reported that the United States was
preparing to impose sanctions on at least a dozen Chinese
officials over their alleged role in Beijing's disqualification
of elected opposition legislators in Hong Kong.
Both oil contracts gained last week after OPEC+, comprising of
the Organization of the Petroleum Exporting Countries (OPEC) and
its allies, agreed to increase output slightly from January but
continue the bulk of existing supply curbs.
"With the OPEC deal in the bag, now traders looked back at
fundamentals, demand and supply, and they were forced to come
back to earth as things are not looking good in the short term,"
said Bjornar Tonhaugen, head of oil markets at Rystad Energy.
A surge in coronavirus cases globally has forced a series of
renewed lockdowns, including strict new measures in the U.S.
state of California and in Germany and South Korea.
Iran, meanwhile, has instructed its oil ministry to prepare
installations for the production and sale of crude oil at full
capacity within three months, state media said on Sunday.
"Adding to the pressure on oil prices is the potential Iranian
increase to production in three months. Iran is optimistic the
U.S. will ease restrictions if they return back to the 2015
nuclear deal," said Edward Moya, senior market analyst at OANDA.
(Reporting by Bozorgmehr Sharafedin in London; Additional
reporting by Jessica Jaganathan in Singapore; Editing by David
Goodman)
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