Oil futures were under pressure Thursday after a rise in the number of COVID-19 cases in China reignited worries about crude demand.
West Texas Intermediate crude futures for March delivery CLH20, -0.70% were off 21 cents, or 0.4%, at $50.96 a barrel, while April Brent crude BRNJ20, -0.95% shed 31 cents, or 0.6%, to $55.48 a barrel.
China on Thursday reported 254 new deaths from the virus over the past 24 hours, while the number of new cases jumped 15,152, after the government applied a new methodology in hard-hit Hubei province of diagnosing infections of the novel strain of coronavirus that reportedly originated in Wuhan, China, last year and was recently classified by the World Health Organization as coronavirus disease. The new figures brought total deaths from the outbreak at 1,362, while the total number of confirmed cases rose to 59,804.
Meanwhile, the International Energy Agency on Thursday lowered it forecast for oil-demand growth to its slowest pace since 2011, blaming the viral outbreak. The Paris-based agency now expects global demand for crude to grow by 825,000 barrels a day in 2020, down 365,000 barrels a day from its previous forecast.
The Organization of the Petroleum Exporting Countries on Wednesday also cut its forecast for growth in crude demand this year.
“The lowered forecasts from OPEC and the IEA on top of the news of more coronavirus cases is pressuring oil lower,” said Jasper Lawler, head of research at London Capital Group, in a note. “The silver lining to all the bad news for the oil market is that it may force the reluctant hand of Russia to support OPEC+ output cuts.” Russia, as a member of the influential group of producers of fossil fuels known as OPEC+, has expressed reluctance about deepening oil cuts as a part of a global pact to curb crude output and stabilize prices.
March natural-gas futures NGH20, +0.33% were up 0.2% at $1.847 per million British thermal units.