- WTI futures remain near multi-month lows at $35.
- Oil prices plunge about 11% on the week on coronavirus concerns.
- Baker Hughes reports the sixth consecutive weekly increase on US oil rigs.
Front-month WTI futures remain near multi-month lows, at $35.35, set for an 11% weekly drop as the release of the Baker Hughes oil rigs data has failed to offer support.
Oil prices plunge on fears about new lockdowns
The US West Texas Intermediate has taken a dip this week, weighed by concerns about the impact on global demand as COVID-19 cases surge in the US and Europe. The new lockdowns introduced in France and Germany, with Spain declaring regional lockdowns has boosted negative pressure on oil prices.
Beyond that, Baker Hughes reported that the number of active oil rigs in the US increased by 10 to 221. These numbers confirm the sixth consecutive increase in the oil rigs count, which adds concerns about an oversupply as the second wave od the pandemic accelerates.
Earlier today, news that Kuwait would back any OPEC+ decision regarding oil production cuts has offered some respite to crude price and allowed the WTI to pop up above $36 for a short time before moving back to the low range of $35.
Oil producers are divided about Russia and Saudi Arabia’s idea of extending the current output cuts of 7.7 million barrels a day into next year, which is weighing further on prices.
Technical levels to watch
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