Oil drops on oversupply warnings, rising COVID-19 cases
Oil prices fell on Wednesday after the International Energy Agency and the Organization of the Petroleum Exporting Countries warned of impending oversupply and as COVID-19 cases in Europe increased the downside risks to demand recovery.
The market pared some of those losses after an unexpected decline in U.S. crude oil stockpiles.
Brent crude futures dropped $2.6%, or $2.15, to settle at $80.28 a barrel. U.S. West Texas Intermediate (WTI) crude futures settled 3%, or $2.40, lower at $78.36 per barrel.
U.S. crude oil inventories fell by 2.1 million barrels last week, latest government data showed, running against analyst expectations for a build of 1.4 million barrels. The IEA on Tuesday warned that while the “oil market remains tight by all measures, ... a reprieve from the price rally could be on the horizon ... due to rising oil supplies.”
New waves of COVID-19 cases in Europe which drove some governments to reimpose restrictions also weighed on prices.
Reference: CNBC
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