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Brent crude fell 52 cents, or 0.9%, to $60.95 a barrel by 1122
GMT and U.S. West Texas Intermediate crude lost 48 cents, or
0.8%, to $58.20.
The Brent benchmark had risen in the previous nine sessions, its
longest sustained period of gains since January 2019. Wednesday
had marked the eighth daily gain for U.S. crude.
"The rally that has been on 'til yesterday’s close may take some
time to be repeated as finally the reality is being priced in,
namely the slow pace of the oil demand recovery," said Rystad
Energy’s head of oil markets, Bjornar Tonhaugen.
The International Energy Agency (IEA) on Thursday said that
global oil supply is still outstripping demand because of
COVID-19 lockdowns and the spread of virus variants.
"The forecasts for economic and oil demand growth are highly
dependent on progress in distributing and administering
vaccines, and the easing of travel restrictions in the world's
major economies," the IEA said.
The market has been driven higher recently as the Organization
of the Petroleum Exporting Countries (OPEC) and its allies, a
group known as OPEC+, reduced output and Saudi Arabia pledged
additional voluntary cuts.
But the IEA said that a rapid stock draw expected in the second
half of the year could set the stage for OPEC+ to start
unwinding its cuts.
Further price pressure came from the end of a blockade by
Libya's Petroleum Facilities Guards at the port of Hariga. The
stoppage at Hariga began last month and contributed to a decline
in Libyan oil output.
Argentina's oil output also started to rise, pressuring prices.
However, U.S. crude stockpiles fell last week for a third
straight week, dropping by 6.6 million barrels to 469 million
barrels, the lowest level since March, the Energy Information
Administration said. Analysts in a Reuters poll had forecast an
increase of 985,000 barrels.
Yet the continuous struggle caused by the emerging variants of
the virus and doubts about the efficacy of vaccines continues to
dampen sentiment.
A UK scientist said the coronavirus variant found in the British
county of Kent is likely "to sweep the world" and could
undermine the protection given by vaccines.
Graphic: Demand/supply balance
https://fingfx.thomsonreuters.com/
gfx/mkt/
gjnpwzyrnvw/demandsupplyfeb.JPG
(Reporting by Bozorgmehr Sharafedin in London; Additional
reporting by Naveen Thukral in Singapore; Editing by David
Goodman)
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