Oil prices slump 8% as virus-related demand concerns resurface - Reuters

Oil prices slump 8% as virus-related demand concerns resurface - Reuters:

Oil prices tumbled about 8% a barrel on Thursday, fuelled by renewed concerns about demand destruction as new cases of coronavirus tick up globally, while crude inventories hit a record in the United States.

U.S. coronavirus cases surpassed 2 million on Wednesday, according to a Reuters tally, and new infections are rising slightly after five weeks of declines. While most states have loosened restrictions on movement that shackled demand, fuel consumption remains 20% below typical levels, as consumers remain cautious.

The U.S. Federal Reserve has expressed concern that this will continue, limiting demand.

“A series of local spikes could have the effect of undermining people’s confidence in travelling, in restaurants, entertainment,” Fed Chair Jerome Powell said on Wednesday.

Brent crude LCOc1 futures fell $3.18, or 7.6%, to settle at $38.55 a barrel. U.S. West Texas Intermediate (WTI) crude CLc1 fell $3.26, or 8.2%, to settle at $36.34 a barrel. Brent and WTI posted their worst daily drops since April 21 and 27, respectively.