Oil Prices Tumble On Demand Worries
Oil prices fell sharply on Monday despite a tropical storm threatening to disrupt output in the U.S. Gulf of Mexico. Prices were weighed down by the possible return of Libyan production as well as rising coronavirus cases in Europe.
Benchmark Brent crude fell 94 cents, or 2.2 percent, to $42.21 a barrel, while U.S. crude futures were down 2.5 percent at $40.30 a barrel.
U.S. tropical Storm Beta, the 23rd named storm of this year’s Atlantic hurricane season, moved ashore prompting some oil producers to evacuate offshore platforms in the region.
Workers at Libya’s major Sharara field have restarted operations, Reuters reported citing sources after the National Oil Corporation indicated production would resume despite the ongoing civil war. But it was unclear when and at what level production might restart.
Meanwhile, coronavirus infections are surging again in Europe, raising uncertainty about the pace of economic recovery and clouding the outlook for energy demand.
Europe’s weekly Covid-19 infections are now higher than the continent’s first coronavirus peak in March, the World Health Organization (WHO) has warned.
U.K. Health Secretary Matt Hancock on Sunday warned that Covid-19 restrictions in England will get tougher if people don’t follow government rules designed to stop the spread of the virus.
Earlier, Prime Minister Boris Johnson said that the country is experiencing the start of a second wave of Covid-19 and stricter lockdown measures will be introduced across the country.
France saw nearly 13,500 new infections in the last 24 hours and there are fears Madrid could be overwhelmed.
In the U.S., at least 18 members of the House of Representatives and Senate have tested positive or are presumed to have had Covid-19.