Fuel Demand Clouded By COVID-19 Spreads Globally

Energy demand continues to be dampened by COVID-19 spreads globally in the last trading session of the week.

At the time this report was written, Brent oil futures were down nearly 1% to trade at $70.50 a barrel.

As Brent oil bulls were unable to hold above $72.50 long enough to trade with clear positivity and settle above that level, the price underwent negative pressure targeting testing $67.45 initially, and breaking this level will push the price towards $65 a barrel.

Accordingly, a bearish bias will be recommended today unless the price manages to breach and hold above $70.50 a barrel on a daily basis.

As of September, global oil demand reached 97.9 million barrels per day a sharp decrease compared to the nearly 99 million barrels per day average seen in July.

The International Energy Agency (IEA) forecast that fuel demand growth slowed in July and will slow down for the remainder of 2021 due to the global spread of the COVID-19 case involving the Delta variant.

According to the Centers for Disease Control and Prevention, the COVID-19 outbreak in the world’s largest economy has increased 85 percent in the past week. Approximately 124,200 cases were reported every single day, an increase of 86%.

Daily hospitalizations have risen by 82% in the last two weeks to more than 68,800. It is estimated that the number of new deaths is up by 75% per day to 552 on average.

Several major oil-consuming countries, including those in Asia, have implemented new COVID-19 restrictions that are expected to reduce mobility and oil used in the second half of 2021.