Oil recovers, threatened by pandemic, supply concerns
Oil prices held steady on Tuesday following their 7% drop in the previous session. The drop was precipitated by the retreat of markets due to worries about an increase in COVID-19 cases worldwide, coming just as producers agreed on a new supply deal.
Brent crude went up 0.6%, or 38 cents, to $69.00 a barrel by 0058 GMT. The US crude contract for August delivery, which expires on Tuesday, rose 0.7%, or 49 cents, at $66.91 a barrel. US crude for September delivery gained around 1% at $66.99 a barrel.
The selloff was “Largely due to concerns centered on the Delta variant and macro backdrop rather than a significant re-think of forward-looking oil fundamentals,” the RBC Capital Markets noted.
The development came after the Organization of the Petroleum Exporting Countries and allies (OPEC+) came to an agreement on Sunday to boost production.
The more virulent Delta variant of the COVID-19 is now the most common strain worldwide, according to US officials’ statement on Friday.