Oil falls as rising coronavirus cases cloud demand recovery

Oil prices slid on Monday as rising coronavirus cases offset hopes for a smooth fuel demand recovery, with main crude benchmarks on course for their first monthly drops in several months following last week’s fall. 

Brent crude slid 0.6%, or 23 cents, at $41.69 per barrel after a 2.9% fall last week. U.S. West Texas Intermediate lost 0.5%, or 21 cents, at $40.04 per barrel following a 2.1% drop last week.

Brent is on course for its first monthly drop in six months, while WTI is headed to fall for the first month since April as reinforced restrictions in several countries clouded the outlook on oil demand recovery.

More crude is being exported from Iran and Libya despite OPEC’s efforts to limit output. Last week, U.S. energy firms also added new oil and natural gas rigs for a second week in a row.

Still, OPEC said that commercial oil inventories are expected to stand right above the five-year average in the first quarter of 2021, before falling for the rest of the year.

On Friday, the U.S. Commodity Futures Trading Commission said that money managers increased their net long U.S. crude futures and options positions in the week ended Sept. 22.