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Oil drops 1% as rising coronavirus cases end supply-led rally

18 January 2021 08:33 (UTC +04:00)

Oil prices fell on Monday, extending losses that last week ended a rally driven by production cuts and strong Chinese demand, with the market’s recovery outlook being called into question as coronavirus infections rise, APA reports quoting Reuters.

Brent crude fell 45 cents, or nearly 1%, to $54.65 a barrel by 0207 GMT, after dropping 2.3% on Friday. U.S. oil was down by 43 cents, also nearly 1%, at $51.93 a barrel, having declined 2.3% in the previous trading session.

The benchmarks had rallied in recent weeks, buoyed by the start of COVID-19 vaccine rollouts and a surprise cut of crude output by the world’s biggest oil exporter, Saudi Arabia. Surging new infections throughout the world, however, have raised doubts about how long demand would hold up.