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Oil prices edge up as investors eye fuel demand recovery

Published 05/07/2021, 09:12 AM
Updated 05/07/2021, 09:20 AM
© Reuters.
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By Florence Tan
SINGAPORE, May 7 (Reuters) - Oil prices edged up in early
Asian trade after a 1% dip in the previous session, as global
economic recovery and easing travel curbs in the United States
and Europe buoyed the fuel demand outlook while the surging
pandemic in India capped prices.
Brent crude futures LCOc1 for July were at $68.17 a barrel
by 0052 GMT, up 8 cents, while U.S. West Texas Intermediate
(WTI) crude CLc1 for June rose 9 cents to $64.80.
Both Brent and WTI are on track for a second weekly gain as
easing restrictions on movement in the United States and Europe,
recovering factory operations and coronavirus vaccinations pave
the way for a revival in fuel demand, while pent-up summer
travel is likely to give gasoline and jet fuel consumption a
further boost.
In the United States, the world's largest oil consumer,
jobless claims have dropped, signalling the labour market
recovery had entered a new phase amid a booming economy.
However, oil demand recovery has been uneven as surging
COVID-19 cases in India has reduced fuel consumption at the
world's third-largest oil importer and consumer.
Resurgence of COVID-19 in countries such as India, Japan and
Thailand is hindering gasoline demand recovery, energy
consultancy FGE said in a client note, though some of that lost
demand has been offset by countries such as China where recent
Labour Day holiday travel surpassed 2019 levels.
"Gasoline demand in the U.S. and parts of Europe is faring
relatively well," FGE said.
"Further out, we could see demand pick up as lockdowns are
eased and pent-up demand is released during the summer driving
season."

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