Oil Declining And Demand Concerns Outweigh Hopes For US Stimulus

Oil prices fell on Tuesday, September 29, erasing gains from the previous session, while chronic demand concerns due to the Corona pandemic outweighed hopes generated by a new US stimulus package that lawmakers find difficult to agree on.

US West Texas Intermediate crude futures fell 34 cents, equivalent to 0.8%, to $ 40.26 a barrel by 06:45 GMT.

Brent crude for December delivery, the most active of December, fell 32 cents, or 0.8%, to $ 42.55 a barrel. The November contract, which expires on Wednesday, fell 27 cents to $ 42.16 a barrel.

In August, Brent and US crude hit their highest levels since early March, amid optimism about increased demand for fuel and strict commitment from major oil producers to the production cuts they pledged, but they have fallen more than three dollars since then due to concerns about demand.

Investors will look for indicators of US demand growth through the American Petroleum Institute data, which will be issued today and the Energy Information Administration and will be issued tomorrow.

Five analysts, in a Reuters poll, expected US crude stocks to grow by 1.4 million barrels on average in the week ending September 25, while gasoline stocks fell by 1.6 million barrels, and refined product stocks, including diesel and jet fuel, were down 800,000 barrels.