Oil prices fell for a third day early on yesterday as concerns about demand amid surging Delta COVID-19 variant continue to weigh on market sentiment.
Before the weekly EIA inventory report, Brent Crude was trading down by 1.60 per cent at $71.25 while WTI Crude was down below $70 per barrel again, after dipping briefly below that mark on Tuesday.
WTI Crude traded at $69.09, down 2.08 per cent. Soaring COVID cases with the fast-spreading Delta variant were front and center in the oil market yesterday, trumping geopolitical tensions with incidents with oil tankers in the Gulf of Oman.
Surging cases in China prompted authorities to order mass testing and travel restrictions. The city of Wuhan, the ground zero for the coronavirus, will test all its 12 million residents.
Travel restrictions and the spread of the Delta variant became a source of concern for the oil market that fuel and industrial demand in China, the world’s largest oil importer, could take a hit.
COVID is also resurging in the biggest economy, the United States, and many other countries from Europe to Southeast Asia and Australia.
The latest COVID-19 scare outweighed concerns about supply from the Middle East, where a tanker was reportedly a target of a hijacking attempt off the coast of the UAE.