Oil clings to third weekly gain with bearish headwinds mounting
Oil is set for a third weekly gain in New York, but the pandemic is leading to an uneven recovery and clouding the demand outlook.
October crude futures rose to a five-month high on Monday after surging with equities on signs that an economic recovery could be within reach. However, that optimism was tempered by downbeat comments from the U.S. Federal Reserve and OPEC on the demand outlook due to the coronavirus, while American unemployment benefits unexpectedly increased last week.
Oil’s rally from below zero stalled in early June near $40 a barrel but prices had started to push higher recently, despite many countries struggling to contain the outbreak. The message from this week’s OPEC meeting was that the market remains fragile and the demand outlook uncertain, with fresh pressure exerted on quota cheats to deliver on promised output curbs.
