On Friday Oil price slipped, adding to losses in the previous session, worries started to gain that fuel demand growth will drop in the midst of resurgence of coronavirus cases and talks on new stimulus has been delayed in the United States.
US West Texas Intermediate (WTI) crude CLc1 futures slipped 2 cents to $41.93 a barrel at 0246 GMT, while Brent crude LCOc1 fell 6 cents, or 0.1%, to $45.03, after both agreement had earlier traded higher.
However, WTI and Brent both are set for weekly gains of at least 4%, the most their benchmark agreement is since the week ending July 3.
The resurgence of COVID-19 has created unstability and uncertainity in the oil market, addingly will also determine how fast fuel demand rebounds. Charts fluctuation show infections in the United States are still in the rise in a number of states, including Colorado, Ohio and Virginia.
Rising cases remain the key uncertainty for fuel demand growth and in turn oil prices, analysts said.
“It really comes down to the demand situation,” said AxiCorp market strategist Stephen Innes.
“We’re caught in limbo trying to collect our thoughts on how the (coronavirus) curve is going to work. Is the flattening in the U.S. going to outweigh flare-ups globally?” he said.
Analysts has kept their keen eyes on the lack of progress in the talks between the White House and Democrats over the next coronavirus stimulus package, with Democrats are of view that if President Donald Trump does not want to negotiate further then President may have to issue executive orders if he does not want to negotiate further
Addressing the issue ANZ Research said in a note that “The virus relief package remains the last hope to boost (fuel) demand, with the U.S. driving season coming to an end soon,”. Over the week, the weekening of U.S. dollar has supported in gaining oil prices making it more more attractive to crude buyers in other currencies.
Since May 2018 on Thursday the dollar index .DXY, which measures the greenback against six major currencies,dropped to its lowest
While the index is slightly up today, the dollar is expected to get lower ahead of U.S. non-farm payrolls data that are widely expected to show jobs creation slowed in July from the previous month amid a surge in COVID-19 infections.
