Oil Holds Near $47 as Investors Weigh Lockdowns Against Vaccine

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Oil was little changed in early Asian trading as investors weighed a bleak near-term outlook for fuel demand due to tightening pandemic restrictions against the distribution of a Covid-19 vaccine in some regions.

Futures traded near $47 a barrel after climbing 0.9% on Monday. New York is heading toward a second full lockdown after a surge in infections, while London will be placed under England’s toughest coronavirus rules from Wednesday. The tighter restrictions come as the U.S. starts delivering its first vaccine doses.

The Organization of Petroleum Countries, meanwhile, cut its projections for oil demand in the first quarter of 2021 as the group and its allies prepare to start returning some crude supply to the market from January.

Oil has climbed to the highest level in nine months as vaccine breakthroughs raised optimism for a recovery in energy demand, despite a resurgent virus leading to tougher restrictions in various regions across the world. Another tanker explosion near a Saudi Arabian port is also raising concerns about the potential for a supply disruption in the Middle East.

190,920 in U.S.Most new cases today

+9% Change in MSCI World Index of global stocks since Wuhan lockdown, Jan. 23

-0.​8361 Change in U.S. treasury bond yield since Wuhan lockdown, Jan. 23

4% Global GDP Tracker (annualized), Oct.


See also: Oil Market’s Floating Hoard Is Weeks From Clearing: Chart

Prices
  • West Texas Intermediate for January delivery lost 7 cents to $46.92 a barrel on the New York Mercantile Exchange at 7:52 a.m. Singapore time.
  • Brent for February settlement gained 0.6% to $50.29 on the ICE Futures Europe exchange on Monday.

OPEC and its allies will meet on Jan. 4 to consider if they can press on with monthly increases in supply, although a report from the group on Monday suggested it can incrementally restore output over the next four months without tipping the market back into surplus.

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