Oil pulls back from 8-week high as COVID-19 cases surge in India

Shafaq News / Oil prices fell on Thursday, pulling back from an eight-week high as concerns about the COVID-19 crisis in India, the world's third-biggest importer of crude, tempered a rally driven by IEA and OPEC predictions that demand is coming back strongly, Reuters reported.

Brent crude was down 66 cents, or 1%, at $68.66 a barrel by 0444 GMT, after gaining 1% on Wednesday. West Texas Intermediate (WTI) was down 67 cents, or 1%, to $65.41 a barrel, having risen 1.2% in the previous session.

Oil demand is already outstripping supply and the shortfall is expected to grow further even if Iran boosts exports, the International Energy Agency (IEA) said in its monthly report on Wednesday.

A day earlier, the Organization of the Petroleum Exporting Countries (OPEC) stuck to its forecast for a strong return of world oil demand in 2021, with growth in China and the United States cancelling out the impact of the COVID-19 crisis in India.

But global concern is rising over the situation in India, the world's second-most populous country, where a variant of the coronavirus is rampaging through the countryside in the deadliest 24 hours since the pandemic began.

Medical professionals are still unable to say for sure when new infections will plateau and other countries are alarmed over the transmissibility of the variant that is now spreading worldwide.

Meanwhile, fuel shortages are getting worse in the southeastern United States six days since the shutdown of the Colonial Pipeline, the largest fuel pipeline network in the world's biggest oil consumer.

Colonial, which pipes more than 2.5 million barrels per day, said it is hoping to get a large portion of the network operating by the end of the week.

"While the disruption is meaningful for local retail markets, its impact is still likely to be transient as there is no physical damage to the pipeline," Goldman Sachs analysts wrote in a new report.