Oil steady as coronavirus fears offset gasoline recovery
signs
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[July 09, 2020] By
Julia Payne
LONDON (Reuters) - Concerns about renewed
coronavirus lockdowns in the United States outweighed signs of a
recovery in U.S. gasoline demand on Thursday to keep a lid on oil
prices.
The market is also in a holding pattern ahead of a meeting on July 15 of
the market monitoring panel of the Organization of the Petroleum
Exporting Countries (OPEC) and its allies.
Brent crude futures were up 5 cents, or 0.12%, to $43.34 by 1139 GMT,
after gaining 0.5% on Wednesday, while U.S. West Texas Intermediate (WTI)
crude futures dipped 14 cents, or 0.3%, to $40.76, after rising 0.7% the
previous day.
"Support will disappear after this week as coronavirus cases are surging
in several U.S. states," Tamas Varga at PVM Oil Associates said, adding
that a fall in prices was likely.
Data from the U.S. Energy Information Administration showed U.S.
gasoline stockpiles fell by 4.8 million barrels last week, much more
than analysts expected, as demand hit its highest level since March 20.
But a spike in coronavirus cases across several U.S. states raised the
prospect of renewed lockdowns that would likely dent any sustained
recovery in fuel demand.
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The sun is seen behind a crude oil pump jack in the Permian Basin in
Loving County, Texas, U.S., November 22, 2019. REUTERS/Angus Mordant
That kept the benchmark crude contracts in tight ranges this week, although
holding above $40 a barrel.
U.S. gasoline demand was falling in areas where lockdowns were being reinstated,
although on the East Coast, where coronavirus infections were under control, it
was recovering well, Lachlan Shaw, head of commodity research at National
Australia Bank, said.
The United States reported more than 60,000 new COVID-19 cases on Wednesday, the
biggest increase reported by a country in a single day.
Libya, whose ports have been blockaded since January, is trying to resume
exports after the state oil firm lifted force majeure at its Es Sider oil
terminal on Wednesday. However, a tanker was prevented from entering the port.
(Reporting by Sonali Paul in Melbourne and Shu Zhang in Singapore; Editing by
Tom Hogue, Jason Neely and Alexander Smith)
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