On Friday, WTI crude oil prices are sliding lower over reports that leading oil producers around the world are planning to ease their supply curbs even as the number of coronavirus cases climbs higher and prompts countries to reimpose lockdown restrictions. At the time of writing, WTI crude oil is trading at around $40.52 per barrel.

Despite the weakness, WTI crude oil is set to post a small gain for the week so far, boosted by a greater than expected decline in US crude inventories and OPEC+ countries’ compliance with the additional supply cuts during the month of September. However, gains remain limited because of the focus on weak demand for oil across the world even after economies reopened.

A resurgence in the number of infections, especially across Europe and the US have dented the sentiment in oil markets as these are among the major energy consumers in the world. As cases rise, expectations for reimposition of restrictions are likely to keep oil prices under check, as such measures could weaken demand even before it picks up after the previous round of lockdowns.

With the weather turning colder, health officials have warned of a second wave of coronavirus cases, even as a vaccine for COVID-19 is nowhere near ready yet. With two pharma companies – Johnson & Johnson and Eli Lilly, pausing their clinical trials for a vaccine earlier this year, the outlook for crude oil has turned even more bearish.