Oil prices fall as COVID-19 cases surge

Gulf Today Report 

Oil declines on Tuesday as California imposed more restrictions in preparation for Christmas as coronavirus cases soar in the United States and Europe.

Brent crude futures fell 40 cents, or 0.8%, to $48.39 a barrel at 0455 GMT, while US West Texas Intermediate (WTI) crude futures fell 35 cents or 0.8%, to $45.41 a barrel. Both benchmark contracts lost around 1% on Monday.

Lachlan Shaw, head of commodity research at National Australia’s Bank said, "the pandemic situation is continuing to be very disruptive in quite a few places in the US and parts of Europe. That's impacting sentiment on demand near term." 

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California, one of the largest consumers of oil has been placed on lockdown lite, affecting the oil markets.

On Monday, Californian authorities required a lot of shops in the city tp close and stay indoors for at least three weeks.

On the other hand, analysts are keenly waiting for the new stimulus package, which is likely to increase energy demand.

Last week OPEC+ decided to hold back scheduled supply increase.