Oil prices unstable as Covid-19 second wave fears increase

Oil prices were unstable on Tuesday morning in Asia, clawing back losses from the previous session.

Brent oil futures slid 0.33% to $29.89 by 9:32 PM ET (2:32 AM GMT). Meanwhile WTI futures gained 1.49% to $24.50. WTI futures slid 2.43%, and Brent futures fell almost 2% on Monday.

Investors were still digesting a surprise move by Saudi Arabia to slash production by a further 1 million barrels from June 1, on top of the cuts already agreed to with <a href=’https://staging.theenergyyear.com/companies-institutions/opec/’>OPEC.

The organization is due to give its monthly oil market report on Wednesday.

Saudi Arabia will also cut its May production “in consent with its customers”, and the move prompted oil-rich Kuwait and the UAE to also announce additional cuts.

Some investors expressed hope that the cuts would lessen the strain on global storage, which is rapidly approaching its limits.

“An extra 1.2 million bpd cut will not re-balance the market but will surely remove strain from the storage infrastructure and buy time to wait for the demand rebound,” Rystad Energy senior oil markets analyst Paola Rodriguez Masiu told CNBC.

But with fears of a second wave of the Covid-19 virus increasing and threatening to shrink the slowly recovering demand, oil’s road to recovery continues to look uncertain.

By Investing.com: https://www.investing.com/news/commodities-news/oil-mixedas-covid19-second-wave-fears-increase-2168799