Oil extends loss on India COVID-19 cases, U.S. pipeline restart

* Coronavirus sweeps through India's countryside
* Biden: U.S. fuel shortages to end in days as pipeline
reopens
* Israeli-Palestinian hostilities enter their fifth day

By Jessica Jaganathan
SINGAPORE, May 14 (Reuters) - Oil prices fell on Friday
after dropping about 3% a day earlier as coronavirus cases
remained high in major oil consumer India and as a key fuel
pipeline in the United States resumed operations after being
shut due to a cyber attack.
Brent crude oil futures LCOc1 were down 35 cents, or 0.5%,
at $66.70 a barrel by 0200 GMT, while West Texas Intermediate
(WTI) was down 28 cents, or 0.4%, at $63.54 a barrel.
"The commodity super cycle rally just hit a hard stop and
the energy market doesn't know what to make of Wall Street's
fixation over inflation and the slow flattening of the curve in
India," said Edward Moya, senior market analyst at OANDA. India
is the world's third biggest oil consumer.
"The crude demand story is still upbeat for the second
half of the year and that should prevent any significant dips in
oil prices," he added.
Prices came under pressure as a broader surge in commodity
prices, labor shortage and much stronger-than-expected U.S.
consumer prices data this week stoked inflation concerns that
could force the Federal Reserve to raise interest rates.
Raising rates typically boosts the U.S. dollar, which in
turn pressures oil prices because it makes crude more expensive
for holders of other currencies. USD/
India recorded more than 4,000 COVID-19 deaths for a second
straight day on Thursday as infections stayed below 400,000,
with experts unsure when numbers will peak. In the United States, President Joe Biden reassured
motorists that fuel supplies should start returning to normal
this weekend, even as more filling stations ran out of gasoline
across the Southeast nearly a week after a cyber attack on the
nation's top fuel pipeline. Colonial Pipeline said late on Thursday it had restarted its
entire pipeline system and had begun deliveries in all of its
markets.
Traders were also watching the situation in the Middle East
after Israel fired artillery and mounted more air strikes on
Friday against Palestinian militants in the Gaza Strip amid
constant rocket fire deep into Israel's commercial centre.