CORRECTED-Oil prices rebound on fears Suez Canal blockage may last weeks

(Corrects to show WTI price change in paragraph 4 is up 49
cents not down)
By Yuka Obayashi
TOKYO, March 26 (Reuters) - Oil prices bounced back on
Friday from a plunge a day earlier on concerns that a large
container ship that ran aground in the Suez Canal may block the
vital shipping lane for weeks, squeezing supply.
Prices, however, were still headed for a third consecutive
weekly loss.
Brent crude LCOc1 was higher by 43 cents, or 0.7%, at
$62.38 a barrel by 0028 GMT, after dropping 3.8% on Thursday.
U.S. West Texas Intermediate (WTI) crude CLc1 was up
49 cents, or 0.8%, at $59.05 a barrel, having tumbled 4.3% a day
earlier.
Both benchmarks were on track for a weekly loss of more than
3%, following a more than 6% decline last week.
The trapped container ship is blocking traffic in the Suez
Canal, one of the world's busiest shipping channels for oil and
refined fuels, grain and other trade between Asia and Europe.
Officials stopped all ships entering the canal on Thursday,
and a salvage company said the vessel may take weeks to free.
"Expectations that the blockage of the Suez Canal may last
for weeks raised fears of supply tightness in oil markets," said
Nissan Securities researcher Yasushi Osada.
"But lingering worries that a fresh wave of lockdowns in
Europe and elsewhere may slow a recovery of global fuel demand
are expected to limit price gains," he said.
Countries in Europe are renewing restrictions to curb
the spread of COVID-19, which will likely reduce fuel demand
from the region. Germany, Europe's largest economy, has seen its
biggest increase in coronavirus cases since January.
In parts of western India, authorities ordered people
indoors as new infections hit the highest level in five months.
The oil market was also under pressure as producers had
difficulty selling to Asia, especially China. Asian buyers
instead took cheaper oil from storage while refinery maintenance
has reduced demand, industry sources said.