Oil prices are under downward pressure caused by the rising number of new virus cases and risks of the second lockdown in most countries.
Prices on oil are nosediving amid threats of a new drop in global demand caused by restrictive measures imposed to stop the virus spread. At the end of October, oil prices began to decline. Moreover, economists do not see any reasons for future recovery.
Investors are extremely concerned about the demand-supply balance. The recent report from the US showed that oil reserves climbed thus boosting fears. Moreover, market participants are really worried about the coronavirus and the associated decline in production and energy consumption. Experts at Goldman Sachs suppose that oil prices are under pressure from the soaring number of virus cases in the world. Authorities of most countries impose tougher quarantine measures thus causing instability in the oil market.
Only the weakening US dollar supports oil. The greenback is losing in value due to uncertainties over a new stimulus package. Nevertheless, analysts think that demand for oil will hardly rise in the near future.
