CORRECTED-Oil prices extend slump as U.S. coronavirus cases climb

(Corrects weekly drop for U.S. oil to first time in seven
weeks, not second weekly decline, in paragraph 4)
TOKYO, June 12 (Reuters) - Oil prices slid early on Friday,
extending heavy overnight losses on a surge in U.S. coronavirus
cases this week that has raised the prospect of a second wave of
the outbreak slamming demand in the world's biggest consumer of
crude and fuel.
West Texas Intermediate CLc1 was down $1.32, or nearly 4%,
at $35.02 a barrel by 0011 GMT, after slumping more than 8% on
Thursday. Brent crude LCOc1 was down $1.15, or 3%, at $37.40 a
barrel, having dropped nearly 8% the previous session.
A rally off April's lows has come to a shuddering halt this
week as the market faced the reality that the coronavirus
pandemic may be far from over globally, with cases in the United
States alone passing 2 million this week.
The oil benchmarks are heading for their first weekly
decline in seven, with Brent dropping about 12%, while U.S.
crude is heading for a loss of more than 10%.
"A sustainable rally needs to include improving gasoline
demand, reducing inventories, increasing product margins to the
point where refiners kickstart runs," RBC Capital Markets said,
noting that "U.S. driving patterns are far from normal."
While producers have been cutting supply, demand remains
constrained by the outbreak, with gasoline stockpiles in the
U.S. last week rising more than expected to 258.6 million
barrels, according to government data. EIA/S
U.S. crude inventories rose against forecasts by 5.7 million
barrels to a record 538.1 million barrels, as cheap imports from
Saudi Arabia flowed into the country.
In the meantime, states including Texas and Arizona are
struggling to cope with a rising number of coronavirus patients
filling hospital beds.
In Houston, Lina Hidalgo, the senior official for the county
that includes the city that is the heart of the U.S. oil
industry, warned "we may be approaching the precipice of a
disaster". More than 7.43 million people have been infected by the
novel coronavirus around the world and more than 400,000 have
died, according to a Reuters tally.