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Oil futures traded lower Friday, putting crude on track for a mixed weekly performance, as investors weighed news of fresh COVID-19 outbreaks in China which has been an engine of demand as other major economies were slowed by the coronavirus pandemic.
West Texas Intermediate crude for February delivery CL.1, -1.12% CLG21, -1.12% fell 55 cents, or 1%, to $53.02 a barrel on the New York Mercantile Exchange, leaving the U.S. benchmark on track for a 1.5% weekly rise. March Brent crude BRN00, -1.54% BRNH21, -1.54%, the global benchmark, was down 85 cents, or 1.5%, at $55.57 a barrel on ICE Futures Europe, headed for a 0.7% weekly fall.
“Oil market euphoria is unequivocally strong, but market indicators from Asia are mixed,” said Michael Tran, analyst at RBC Capital Markets, in a note.
“China, the global engine of oil demand growth, is wrestling with fresh COVID outbreaks and lockdowns in various regions throughout the country have led to a tapering in discretionary driving patterns,” he said.
Barron’s reported that China saw 107 locally transmitted cases of coronavirus on Wednesday, according to its National Health Commission, the most since July. On Tuesday, it saw 85 cases. Although the numbers seem small compared with large daily tallies in the thousands in the U.S. and elsewhere, they come after China went for a long stretch with few outbreaks following a hard lockdown last year.
Ninety percent of the new cases are in Hebei province, which encircles Beijing, prompting a quick lockdown that has led to 28 million people under home or hotel quarantine, the commission said.
The global tally for confirmed cases of the coronavirus that causes COVID-19 climbed above 93 million on Friday, according to data aggregated by Johns Hopkins University, while the death toll rose above 1.99 million. The U.S. has the highest case tally in the world at 23.3 million and the highest death toll at 388,705, or more than a quarter of the global total.
