Oil slips on rise in coronavirus cases and US-China standoff

Singapore — Oil prices edged lower on Monday as rising coronavirus cases and tensions between the US and China pushed investors towards safe-haven assets.

Brent crude dipped 14c, or 0.3%, to $43.20 a barrel by 4.42am, while US West Texas Intermediate (WTI) crude dropped to $41.19 a barrel, down 10c, or 0.2%.

The fall in oil mirrored moves in broader financial markets in Asia amid concerns about escalating tensions between the world’s two biggest economies after the closures of consulates in Houston and Chengdu. Global coronavirus cases, meanwhile, exceeded 16-million.

Still, Brent is on track for a fourth consecutive monthly gain in July and WTI is set to rise for a third month as unprecedented supply cuts from Opec and its allies including Russia propped up prices. Output has also fallen in the US.

Oil demand has improved somewhat from the deep trough of the second quarter, supporting prices, though the recovery path is uneven as resumption of lockdowns in the US and other parts of the world is capping consumption.