Oil falls 2% as Libyan output soars, pandemic-driven demand worries weigh

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Oil falls 2% as Libyan output soars, pandemic-driven demand worries weigh

Crude oil futures’ prices plunged as much as 2 per cent on Friday and wrapped up the week lower as a surge in Libyan output alongside a demand disruption caused by soaring pandemic cases in the United States and Europe, bolstered investors’ belief on a likely supply glut over the coming weeks.

In point of fact, crude oil futures started off the session in a tentative note, however slipped further after Libyan National Oil Corp. had told that it had lifted force majeure on oil exports and the oil-rich country’s output would be reaching 1 million barrels per day or roughly 1 per cent of entire global output in next four weeks, whole a director of energy futures at Mizuho in New York, Bob Yawger was quoted saying “As soon as that came out, the market cratered”.

Crude oil prices clatter as Libyan output set to rise, pandemic cases surge

Aside from that, later this week the Russian President Vladimir Putin was quoted saying that he would not phase out the possibilities of an extension of OPEC+ production cut, which in effect had helped oil pare some of its losses, though that assurance might not ease pressures of rising Libyan output alongside demand crunches, suggested analysts.

Quoting statistics, on Friday’s commodity market round off, US West Texas Intermediate (WTI) crude oil futures’ prices faltered 1.9 per cent to $39.85 per barrel, while UK crude futures’ prices settled down the day 1.6 per cent lower to $41.77 a barrel.

For the week, Brent crude lost 2.7 per cent and US WTI crude oil futures shed 2.5 per cent. Meanwhile, referring to an uncertain demand outlook which appears to be failing the crude oil futures’ cause in recent weeks, a senior analyst at Price Futures Group in Chicago, Phil Flynn said on Friday’s commodity market wind down, “What’s holding us back is the uncertainty about demand - when we’re going to get a vaccine, when things are going to get back to normal, concerns about more shutdowns.