Oil under pressure as coronavirus spike stokes demand concerns

LONDON: Oil prices were steady on Wednesday, with researchers predicting renewed downward pressure from concerns that a recovery in fuel demand will be stalled by soaring coronavirus cases worldwide.

Brent crude futures for December delivery were little changed at $42.48 a barrel by 1228 GMT. US West Texas Intermediate futures also traded flat at $40.18.

"There is a risk that the demand recovery is stalled by the recent increase in COVID-19 cases in many countries," the International Energy Agency said on Wednesday.

"The longer term offers little encouragement for producers; the curve shows prices not reaching $50 per barrel until 2023. Truly, those wishing to bring about a tighter oil market are looking at a moving target."

The Organization of the Petroleum Exporting Countries (OPEC) cut its oil demand forecast on Tuesday, citing economic dislocations caused by the virus.

Russian Energy Minister Alexander Novak said that leading oil producers will start easing output curbs as planned in January despite a spike in coronavirus cases.

"Crude prices are looking very vulnerable as the coronavirus continues to spread like wildfire across Europe and trending higher in the US," said Edward Moya, a senior market analyst at OANDA.

US crude oil inventories were seen falling last week while distillate stockpiles are likely to have declined for a fourth week, a preliminary Reuters poll showed on Tuesday.

The poll was conducted ahead of reports from the American Petroleum Institute and the Energy Information Administration.

Both reports were delayed by a day because of a public holiday in the United States on Monday.