Crude oil (CL1:COM) reverses earlier losses amid a weaker U.S. currency, easing a decline this week which has been led by a gloomy demand outlook as coronavirus cases surge.

August WTI +1.6% to $40.25/bbl; September Brent +1.6% to $43.04/bbl.

Prices had dropped earlier after Libya lifted its force majeure on all oil exports after a half-year blockade by rebel forces.

“Further job losses are on the horizon as several states reimpose lockdown restrictions,” says Stephen Brennock of oil broker PVM. “America is still in the throes of the pandemic, and this spells bad news for the oil demand outlook.”

The International Energy Agency bumps up its 2020 oil demand forecast, raising its forecast by 400K bbl/day to 92.1M, citing a smaller than expected Q2 decline.

But the IEA warns the spread of COVID-19 poses a risk to the outlook, calling the surge in cases “a disturbing reminder that the pandemic is not under control, and the risk to our market outlook is almost certainly to the downside.”

ETFs: USO, XLE, UCO, XOP, VDE, OIH, GUSH, BGR, ERX, BNO





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