Oil rises on weakened U.S. storm, but recovery fears remain
Oil prices gained in early Tuesday trade, recovering from overnight losses as the latest tropical storm in the Gulf of Mexico weakened. Still, worries about fuel demand remained as global coronavirus cases surged.
Brent crude futures climbed 0.3%, or 14 cents, at $41.58 per barrel. U.S. West Texas Intermediate crude futures for October delivery rose 0.5%, or 19 cents, at $39.50 per barrel. The more active November contract was up 0.3%, or 13 cents, at $39.67 per barrel.
Crude prices steadied after falling nearly 4% on Monday as Texas refineries stayed open despite forecasts of flooding. Tropical Storm Beta is expected to keep weakening, relieving U.S. refinery demand worries.
Monday’s price decline was prompted by worries that rising coronavirus cases could lead to renewed lockdowns and social restrictions. Markets are worried about demand in several places, including the United Kingdom, which reimposed restrictions. U.S. health officials are also warning of a new wave in the coming winter.
Traders are awaiting the American Petroleum Institute to release the U.S. oil stockpile data due later today. U.S. crude oil and gasoline stocks are expected to have fallen last week. Distillate inventories, including diesel are expected to have increased.