Home ›› 20 Aug 2021 ›› World Biz
Oil prices fell for a sixth day in their longest losing streak since February 2020, as a spike in Covid-19 cases worldwide fuelled fears of lower fuel demand while a surprise build in US gasoline inventories and a stronger dollar added to the pressure.
Brent crude was down $1.11, or 1.6 per cent, at $67.12 a barrel at 0639 GMT, after touching the lowest since May 24 at $67.06 earlier in the session.
US West Intermediate crude (WTI) fell $1.35, or 2.1 per cent, to $64.11 a barrel after falling to as low as $64.02, also the lowest since May 24.
WTI has dropped more than 7 per cent while Brent has slumped more than 6 per cent during the six-day losing streak, the longest since a six-day decline for both contracts that ended on Feb. 28, 2020.
The declines reflect worries over rising coronavirus infections caused by its Delta variant, with virus-related deaths in the United States, the world’s largest oil user, spiking over the past month.
“Crude prices continue to look vulnerable around those mid to late summer support levels - $65 in WTI and $67 in Brent,” Craig Erlam, senior market analyst at OANDA Europe, said in a note.
Slower growth in China, the world’s biggest oil importer, caused by new restrictions in response to rising Covid-19 cases and some weakness in US data over the past week have driven the softness in oil prices, Erlam said.
“A move below $65 in WTI, for example, could see prices drop back into Q2 trading ranges between $57 and $65. This would be quite a drop from the levels we’ve seen the last couple of months,” he added.
An unexpected rise in US gasoline inventories last week also fanned concerns over slowing demand, given demand for gasoline typically peaks during the northern hemisphere summer.
