Oil slips on weaker demand outlook after U.S. gasoline stocks build

Oil slips on weaker demand outlook after U.S. gasoline stocks build

22 Oct 2020 10:19 AM
 

Oil prices dropped in early trade on Thursday, adding to heavy losses overnight, after a build in U.S. gasoline inventories pointed to a deteriorating outlook for fuel demand as coronavirus cases soar in North America and Europe.

U.S. West Texas Intermediate (WTI) crude futures fell 27 cents, or 0.7%, to $39.76 a barrel at 06:57 am, after skidding 4% on Wednesday.

Brent crude futures retreated 21 cents, or 0.5%, to $41.52 a barrel after sliding 3.3% on Wednesday.

U.S. gasoline stocks rose by 1.9 million barrels in the week to Oct. 16, the Energy Information Administration (EIA) said, compared with expectations for a 1.8 million-barrel drop.

Overall product supplied, a proxy for demand, averaged 18.3 million barrels per day in the four weeks to Oct. 16, the EIA said - down 13% from the same period a year earlier. 

With new daily COVID-19 infections hitting records in several U.S. states and in Europe, new lockdowns and China's clampdown on outbound travel to help stem the spread of the disease bode ill for fuel demand.