Oil prices rallied after touching multi-decade lows in April, but they have been stuck in a narrow trade band for 2 months now as the pent-up U.S. demand rebound in June has fizzled out with flattening fuel consumption that continues to struggle to reach pre-pandemic levels.
The news of the spread of coronavirus outside the Chinese city of Wuhan and the first confirmed case in the United States have pressured crude oil prices. The concern is that the Chinese economy will be harmed and reduce global demand for crude oil.
Crude oil prices have been on a rally since the beginning of December as OPEC and Russia agreed on deeper cuts in production and the agreement of Phase One of the US-China trade deal. The crude oil stocks draw added to the bullish price sentiment.
Crude oil prices have rebounded as OPEC and Russia appear to be agreeing on deeper cuts in production Prices were future supported by the latest DOE report showing that crude oil stocks drew greater than expected.