Oil prices closed down more than 1 percent on Wednesday amid concerns over oil demand due to the spread of the coronavirus.
In particular, despite the news that the U.S. crude oil inventory decreased last week, the deal ended with a weak trend as demand contraction factors such as the expansion of movement restrictions due to the spread of the coronavirus.
Reuters reported that international oil prices fell for the fifth day of trading as the number of confirmed cases caused by the coronavirus surged, raising the prospect of falling demand for crude oil.
In fact, West Texas crude (WTI) hit $73.95 a barrel and Brent crude hit $76.33 a barrel on the 30th (local time), the last trading day of last month, but the decline continued in August.
On the New York Mercantile Exchange, WTI closed at $6.46 a barrel, down $1.13 and 1.70 percent from the previous day. The WTI closed at $68.15 a barrel on Tuesday, after hitting $71.26 a barrel on the first trading day of August 2. The WTI, which has been on the decline since then, has fallen for five consecutive days since the 12th of this month, down to $65 a barrel.
Brent crude also fell 80 cents, 1.16 percent, to $68.23 a barrel. Brent crude has also been on the decline since its close of $72.89 on the 2nd, the first trading day. On the 9th (local time), the closing price closed at $69.04 a barrel, breaking the $70 per barrel level, but continued trading at the early $70 per barrel for four trading days. As the fifth day of trading continued, it closed at $69.51 a barrel on the 16th, collapsing the $70 level and showing less than $70 a barrel on the third day of trading.
Some analysts say the coronavirus will dampen the economy. Reuters reported that according to the U.S. Federal Reserve’s policy meeting late last month, the spread of the delta mutation virus could delay the full resumption of the economy and curb the job market.
U.S. crude oil inventories declined amid weak international oil prices, the report showed. Last week, the U.S. Energy Information Administration (EIA) announced that crude oil inventories fell by 3.2 million barrels to 435.5 million barrels. Reuters said it was the lowest level since January 2020.
U.S. crude oil production, on the other hand, increased. U.S. crude oil production stood at 11.4 million barrels last week, up 100,000 barrels a day from the previous week, according to the EIA report.
