News: Oil drops as rising stockpiles compound COVID-19 demand concerns.
TOKYO (Reuters) – Oil prices fell for the third consecutive year on Tuesday as rising inventory levels in the US added to concerns about demand risks as countries like Germany and France stop COVID-19 vaccinations.
Brent crude fell 49 cents, or 0.7%, to $ 68.39 by 0433 GMT after falling 0.5% on Monday. US crude fell 47 cents, or 0.7%, to $ 64.92 a barrel after falling 0.3% in the previous session.
Germany, France and Italy plan to suspend AstraZeneca PLC COVID-19 injections after reports of possible serious side effects, despite the World Health Organization saying it was unrelated to the vaccine.
These measures add to concerns about slow vaccination rates in the region, which could delay an economic recovery from the pandemic in one of the hardest hit areas.
The pandemic gutted demand for oil, but prices have rebounded to pre-global health crisis levels, only to be limited as vaccination adoption has been slow in most countries.
In the United States, inventories are also rising due to last month’s “big freeze” which stopped refineries that have taken some time to fully return.
“Prices are under pressure from expectations that the Texas winter storm last month could further boost crude oil inventories,” said Avtar Sandu, senior manager of commodities at Phillip Futures in Singapore.
The American Petroleum Institute, an industry group, will report crude oil inventories later Tuesday, followed by official Energy Department figures on Wednesday. Analysts expect another week of profit. [API/S]
Crude oil inventories rose 12.8 million barrels for the week ending March 5, contrary to analyst expectations for an increase of less than 1 million barrels.
Reporting by Aaron Sheldrick; Arrangement by Christopher Cushing & Simon Cameron-Moore
Original Source © Reuters