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Oil Falls 4 on Fuel Demand Concerns

Oil prices fell 4 on Monday on worries that widening coronavirus lockdowns in Europe would weaken fuel demand and amid concerns about turbulence over this weeks U.S. presidential election.

Brent crude futuresĀ for January dropped 1.49, or 3.9, to 36.45 a barrel by 0745 GMT, while U.S. West Texas Intermediate WTI futuresĀ fell 1.58, or 4.4, to 34.21.

Brent fell as much as 5.8 and WTI as much as 6 in early trade, hitting their lowest levels since May.

Countries across Europe have reimposed lockdown measures to try to slow COVID19 infection rates that have accelerated in the past month.

Global oil trading companies expect further demand destruction although estimates differ. Vitol sees winter demand at 96 million barrels per day bpd while Trafigura expects demand to fall to 92 million bpd or below.

A lot of traders are now looking at the U.S. and their rising infection rates and wondering if Europe is providing the model for what will happen in the U.S. in the coming weeks, said Michael McCarthy, chief market strategist at CMC Markets in Sydney.

Oil pared some losses after Japans export orders grew for the first time in two years and Chinas factory activity rose to a neardecade high in October. More manufacturing surveys are expected from the eurozone and the United States later in the day.

Still, concerns about weakening demand and rising supplies from OPEC and the United States caused oil prices to fall for a second straight month in October, with WTI falling 11 and…

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