Brent crude futures fell 13 cents to settle at $71.31 a barrel. Earlier, Brent hit a session high of $71.90, while U.S. West Texas Intermediate crude fell 16 cents to settle at $69.09 a barrel.
The international energy watchdog’s monthly report said rising demand for oil reversed course in July and was set to proceed more slowly for the rest of the year after the latest wave of COVID-19 infections prompted countries to bring in restrictions again.“Growth for the second half of 2021 has been downgraded more sharply, as new COVID-19 restrictions imposed in several major oil consuming countries, particularly in Asia, look set to reduce mobility and oil use.
“We now estimate that demand fell in July as the rapid spread of the COVID-19 Delta variant undermined deliveries in China, Indonesia and other parts of Asia,” the Paris-based IEA said. The IEA put the demand slump last month at 120,000 barrels per day and predicted growth would be half a million bpd lower in the second half than it had estimated last month, noting some changes were due to revisions in data.
“The IEA report seemed to suggest we’d see demand weaken a bit because of the COVID flare-up and because that will reduce the odds of a so-called super cycle in oil,” said Phil Flynn, a senior analyst at Price Futures Group in Chicago.
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