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Oil prices slump 4% on jitters over Europe lockdowns, U.S. elections

Published 11/02/2020, 08:46 AM
Updated 11/02/2020, 08:50 AM
© Reuters.
LCO
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* Brent hits low of $35.74/bbl; WTI low at $33.64/bbl
* OPEC output rises for 4th month in Oct - Reuters survey

By Florence Tan
SINGAPORE, Nov 2 (Reuters) - Oil prices slumped more than 4%
on Monday to the lowest levels since May on worries a swathe of
coronavirus lockdowns across Europe will weaken fuel demand,
while traders braced for turbulence during the U.S. Presidential
election week.
Brent crude LCOc1 for January was at $36.32 a barrel, down
$1.62, or 4.3%, by 0018 GMT, while U.S. West Texas Intermediate
CLc1 fell $1.62, or 4.5%, to $34.17 a barrel. Brent earlier
hit a low of $35.74 a barrel while WTI slipped to $33.64 a
barrel.
Countries across Europe have reimposed lockdown measures
aimed at slowing COVID-19 infection rates which have accelerated
in the continent in the past month. "The lockdown measures announced by UK and by Italy are just
adding to the deteriorating European situation," Michael
McCarthy, chief market strategist at CMC Markets in Sydney said.
"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."
Concerns about weakening demand and rising supplies caused
oil prices to fall for a second straight month in October, with
WTI falling 11% and Brent 8.5%.
Rising supplies from Libya and Iraq, members of the
Organization of the Petroleum Exporting Countries (OPEC) offset
production cuts by other members and caused the group's output
to rise for a fourth month in October, a Reuters survey showed.
OPEC and their allies including Russia, a group known as
OPEC+, are cutting output by about 7.7 million barrels per day
in a pact aimed at supporting prices.
OPEC+ is scheduled to hold a policy meeting over Nov. 30 and
Dec. 1.

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