Oil futures fell Friday, remaining under pressure as COVID-19 cases continued to rise, underlining worries over demand.
West Texas Intermediate crude for December delivery fell $1.05, or 2.7%, to $37.74 a barrel on the New York Mercantile Exchange, while January Brent crude was off $1.02, or 2.5%, to $39.92 a barrel on ICE Futures Europe.
Investors fear the continued rise in COVID-19 infections threatens to squelch the economic rebound. The U.S. on Thursday saw new cases top 100,000 for a second day in a row, marking consecutive records, while several European countries have imposed tougher lockdowns.
The pandemic is “casting its shadow on the oil market because record numbers of new cases and deaths are being reported on a daily basis in many countries,” said Eugen Weinberg, analyst at Commerzbank, in a note. “The restrictions that are already in place, coupled with possible long-term changes to travel behavior, are likely to prompt the oil agencies to downwardly revise their demand forecasts next week.”
Oil remains on track for strong weekly gains though. Crude was boosted earlier in the week as stocks extended gains following U.S. Election Day. Democratic challenger Joe Biden continued to close in on a victory over President Donald Trump Friday morning. That’s a potential weight on crude, Weinberg said, because it makes a rapprochement with Iran more likely, which would add more crude to the market.