Although several forecasts estimated that the oil demand will drop due to the coronavirus outbreak, oil prices ended up higher about 1%, for 3rd straight session, while investors expected that the oil producers would cut more output.
In fact, the brent crude increased by 0.99% to settle at $56.34 per barrel and the United States’ West Texas Intermediate crude oil (WTI) marked an increase of 25 cents, or 0.49% to $51.42 per barrel. At the same time, the U.S. gasoline jumped more than 1%.
At the same time, Organization of the Petroleum Exporting Countries (OPEC) has lowered its 2020 demand forecast for its crude oil by 20.000 barrels per day, while another 600.000 Bpd are estimated to be cut.
According to Reuters, the oil refiner China National Chemical Corp. (CNCC) announced that it would lower its production by around 100.000 barrels per day (bpd) following the travels restrictions and the quarantines
In light of the situation, the US Energy Information Administration announced that will cut its global oil demand growth forecast for 2020 by 310.000 barrels per day (bpd) as the coronavirus outbreak impedes oil consumption in China, the world’s second biggest economy.