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

Published 02/11/2020, 11:46 am
Updated 02/11/2020, 11:48 am
© Reuters.
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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. 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. 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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