Oil drops as European lockdowns douse hopes for fuel demand recovery

Oil prices fell on Monday, losing nearly 1% as fears about a decline in fuel demand amid new European lockdowns dominated markets.

Brent crude dropped 0.9%, or 60 cents, at $63.93 per barrel, while U.S. oil lost 1.1%, or 68 cents, at $60.74 per barrel. Both benchmarks slid by over 6% last week.

Germany plans to extend restrictions to control COVID-19 infections into a fifth straight month as fresh cases exceeded expected levels.

OPEC and its allies have implemented unprecedented cuts to balance global markets after demand dropped during the coronavirus pandemic.

U.S. drillers are taking advantage of an earlier surge in prices on optimism about demand recovery, adding the highest number of rigs since January.

The oil and gas drilling rig tally climbed nine to 411 last week, the highest since April. The rig count has risen in the last seven months and is up almost 70% from a record low of 244 in August.