Oil prices drop, traders weigh a rising number of COVID-19 attacks

Oil traders are now weighing the ever-rising number of COVID-19 cases and the impact on global energy demand.

Oil prices dipped lower at the fourth trading session of the week, as traders are now weighing the ever-rising number of COVID-19 cases and the impact on global energy demand against a fifth consecutive week of declines in US oil production.

The number of global COVID-19 cases surpassed 90.87 million as of Jan. 12, according to Johns Hopkins University data.

Stephen Innes, Chief Global Market Strategist at Axi, in a note to Nairametrics, spoke on OPEC+ intentions coupled with the world’s largest economy crude oil stockpiles’ macro:

“Oil market sizzling rally likely took a hiatus as the stronger dollar and the omnipresent gasoline supply overhang offset the evaporating US crude inventories capping both primary benchmarks under key psychological and technical inflexion points.

“Even before the not so rosy gasoline read on the US Department of Energy (DOE) report, this gnawing temporal disconnect was weighing on market sentiment with spot miraculously trading better now than they were before the pandemic.”

 

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