August 7. Information Center - Oil dipped below $45 a barrel on Friday on
worries that a demand recovery would slow due to a resurgence of coronavirus
cases, although a pledge from OPEC member Iraq to cut oil output further in
August provided support, Reuters reports.
The resurgence of infections remains a key issue for the
market and demand outlook. Tallies show cases in the United States are rising
in a number of states. India reported on Friday a record daily jump in
Brent crude fell 51 cents, or 1.1%, to $44.58 by 1209 GMT.
U.S. West Texas Intermediate (WTI) crude also slipped 51 cents, or 1.2%, to
$41.44. Both benchmarks are set for weekly gains of more than 2%.
“Keeping the price levels would be unrealistic,” Bjornar
Tonhaugen of Rystad Energy said of this week’s rise. “Traders rushed to the
task today to correct the gains, remembering the invisible enemy, COVID-19.”
Traders were also watching talks in the United States over
the next coronavirus stimulus package. Democratic leaders in the U.S. Congress
and top aides to President Donald Trump failed to make substantial progress on
“Failure to extend aid would deal a massive blow to the
recovering U.S. economy and the fragile oil demand outlook,” said Stephen
Brennock of oil broker PVM.
Prices have recovered from lows reached in April, when Brent
slipped below $16, a 21-year low, thanks in part to a record deal on supply
cuts by OPEC and its allies.
Saudi Arabia’s energy minister and his Iraqi counterpart
stressed their countries’ full commitment to the deal.
Iraq has been a laggard in fully meeting its pledge.
Over the week, a weaker U.S. dollar helped to support prices
by making the commodity more attractive to buyers holding other currencies.
The dollar index, up on Friday, is expected to weaken ahead
of U.S. non-farm payrolls figures later in the day that is forecast to show job
creation slowed in July.