Oil Prices Plunge over Outbreak of COVID-19 Delta Variant
Oil prices plunge on Tuesday as demand fear rises due to the outbreaks of the highly contagious COVID-19 variant Delta and the re-emergence of travel restrictions. The new development has raised fear over demand outlook ahead of the Organisation of Petroleum Exporting Countries and allies (OPEC+) meeting on July 1.
The more transmissible Delta variant has spread to almost every state in the US, fueling health experts’ concerns about Covid-19 spikes.
The variant is expected to become the dominant coronavirus strain in the US, the director of the Centers for Disease Control and Prevention said in a statement. International benchmark Brent crude was trading at $74 a barrel after a 0.19% decrease from $74.14 a barrel on Monday.
American benchmark West Texas Intermediate (WTI) traded at $72.86 a barrel at the same time, a 0.07% drop after ending the previous session at $72.91 per barrel.
Uncertainties on whether restrictions due to the coronavirus variant will be re-imposed in Europe and many Asian countries are weighing on prices.
Investors also await US crude oil inventory data to be announced by the country’s Energy Information Administration (EIA) on Wednesday.
Another key signal anticipated is the outcome of the Organization of the Petroleum Exporting Countries and other affiliated producers, known as OPEC+, at Thursday’s meeting, and whether it will reflect investor demand fears in their production quota decision.
The UK saw its highest daily number of coronavirus cases since the end of January this year. In Russia, 21,650 coronavirus cases were recorded over the past day, raising the overall count to more than 5.47 million with active cases reaching 369,708 – the highest figure since Jan. 20.
Bangladesh recorded a new spike in COVID-19 infections with 8,364 cases, raising fears of a serious crisis in hospital beds if the surge continues.
In a related development, a missile attack was carried out Monday on the US-controlled Al-Omar oil field from Mayadin district in Syria’s Deir-ez-Zor province, which is under the control of the Bashar al-Assad regime and Iran-backed militia groups.
Al-Omar, Syria’s largest oil field, where the US and YPG/PKK terror group are present, was attacked with Grad missiles, according to local sources.
At least five missiles were launched from Mayadin district, where numbers of Iranian-backed armed groups are increasing, and some of them struck close to a military base near the oil field where US forces are located.
Iran has been on the negotiation table with the United States on its nuclear program as the country seeks bans on its oil export lifted.
Oil Prices Plunge over Outbreak of COVID-19 Delta Variant
