Volatile Oil Prices Still Poised for Second Monthly Decline

EghtesadOnline: Global oil prices moved in and out of negative territory on Friday but remained on course for a second monthly fall as rising Covid-19 cases in Europe and the United States heighten concerns over fuel consumption.

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31 October 2020

Brent crude was up 3 cents at $37.68 a barrel after touching a five-month low in the previous session. The December Brent contract expires on Friday and the January contract was trading broadly flat, Reuters reported.

US West Texas Intermediate crude rose 8 cents to $36.25 after dipping to its lowest since June on Thursday. It is on track for a 10% monthly decline while Brent heads for an 8% drop.

Prices had swung between parity and a more than 2% decline during Friday’s session, with the market “anxious” about renewed lockdowns in Europe and the US election next week, a Singapore-based oil trader said.

The Organization of the Petroleum Exporting Countries and allies including Russia, a group known as OPEC+, had planned to raise output by 2 million barrels per day in January.

However, top producers Saudi Arabia and Russia are in favor of maintaining the group’s current output reduction of about 7.7 million bpd into next year in the face of lockdowns in Europe and rising Libyan oil output.