Oil dropped below $61 a barrel on concerns about the near-term demand outlook amid the uneven rebound from the pandemic.
Futures in New York slipped 1.1% after two days of gains. Covid-19 cases are surging in India and threatening the economy’s recovery from a rare recession, while in Southeast Asia, demand has hit a plateau and is unlikely to reach pre-virus levels until the end of 2021 or later. In the U.S., New York City’s mayor urged a pause on reopening, and some European nations are extending or reimposing lockdowns.
The prompt timespread for global benchmark Brent crude, meanwhile, is near the narrowest backwardation in about two months. The bullish structure is rapidly approaching a bearish contango, a signal of oversupply.
- West Texas Intermediate for May delivery lost 70 cents to $60.86 a barrel on the New York Mercantile Exchange at 7:52 a.m. London time.
- The April contract expired Monday after adding 0.2%.
- Brent for May settlement fell 1.2% to $63.88 on the ICE Futures Europe exchange after rising 9 cents in the previous session.
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