Oil prices fell on Monday, extending last week’s losses, as increasing coronavirus cases in the United States and Europe raised worries about energy demand, while Libya’s fast growing production also weighed on prices.
The United States reported its highest number yet of new coronavirus infections in two days through Saturday, while in France new cases hit a record of more than 50,000 on Sunday. Italy and Spain imposed fresh restrictions to curb the virus.
The rising number of cases “not only highlight the risks posed by immediate transport restrictions, but also dampen long-term demand expectations, OPEC’s secretary general Mohammed Barkindo said OPEC+ producers did not expect a renewed oil-price collapse as seen in the second quarter, and said producers in the OPEC+ alliance would continue to “stay the course” in balancing the market.
In the United States, energy companies increased their rig count by five to take the total to 287 in the week to Oct. 23, the most since May, energy services, the rig count is an indicator of future supply.
Still, investors increased their net long positions in U.S. crude futures and options during the week through Oct. 20, the U.S. Commodity Futures Trading Commission said on Friday.
We can look to Wednesday for clues on where oil could head towards with the crude stocks change data coming out midweek.