WTI Crude Oil Under Pressure – Focus on Pandemic’s Impact on Demand
Arslan Butt • 1 min read
Early on Tuesday, WTI crude oil is exhibiting signs of mixed trading as markets focus on oil demand failing to improve even as several countries around the world report a resurgence in cases after reopening their economies. At the time of writing, WTI crude oil is trading at around $38.96 per barrel.
Following an easing of lockdown restrictions, the number of coronavirus infections is continuing to climb higher across the US, Britain and India, raising fears that governments could reimpose lockdowns which could further impede recovery in oil demand. Crude oil prices came under additional pressure after Saudi Arabia cut its official selling price for crude being sold to Asia.
WTI crude oil also faces downward pressure over an upcoming period of maintenance for US refineries. During the maintenance season, the demand for crude oil is expected to fall by 1.5-2 million bpd, even as overall demand remains weak due to the pandemic-driven restrictions on international travel.
After seeing a rebound over the previous sessions on account of a weakness in the US dollar, WTI oil prices have slid below the key $40 level once again. The main focus among oil traders remains on the coronavirus pandemic delaying economic recovery globally, which could keep oil demand lower for more time than previously anticipated.