22 minutes ago
SINGAPORE: Oil fell in morning trading in Asia on Thursday despite a significant drop in US crude stocks, at a time when prices were pressured by the strengthening of the US dollar and new concerns about fuel demand due to travel restrictions and delays in the distribution of anti-Corona virus vaccines.
US West Texas Intermediate crude futures fell 33 cents, or 0.62 percent, to $ 52.52 a barrel by 0452 GMT, erasing Wednesday’s gains.
Brent crude futures fell 36 cents, or 0.65 percent, to $ 55.45 a barrel, after losing ten cents on Wednesday.
The US dollar rose in general, while its index rose to 90.753 from its low level in January of 89.206, which puts pressure on the primary commodities priced in dollars.
The oil market received support earlier this week due to a sudden big drop in US crude stocks in the week ending January 22, which analysts attributed to the recovery in US crude exports and the decline in imports.
But attention is now shifting to demand concerns in light of the increase in cases of Covid-19 with new infectious strains, a slower pace of distribution of vaccines in Europe and restrictions on travel in countries such as China.
The European Union failed to achieve a breakthrough in crisis talks with AstraZeneca on Wednesday, and more comprehensive checks of vaccines are being conducted before their approval, which means a greater slowdown in the vaccination rate compared to Britain, a former member of the bloc, and growing public frustration.
The situation was exacerbated by the announcement by the English-Swedish company AstraZeneca and US-based Pfizer to delay deliveries in recent weeks.
Fears about demand have increased as China, the second largest consumer of oil in the world, is now facing a spike in Coronavirus infections and is seeking to limit travel as it approaches the busiest travel season of the year, usually the Lunar New Year holiday.