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Oil Extends Losses as Stockpiles Rise Amid Weakening Demand

Oil Extends Losses as Stockpiles Rise Amid Weakening DemandOil Extends Losses as Stockpiles Rise Amid Weakening Demand

Oil prices fell for a second day on Friday, pressured by a surprise rise in US stockpiles as the coronavirus pandemic continues to erode demand for fuels.
Brent crude was down 18 cents, or 0.5%, at $39.88 a barrel, after falling nearly 2% on Thursday, while US crude dropped 14 cents, or 0.4%, to $37.16 a barrel, having fallen 2% in the previous session, CNBC reported.
Both major benchmarks are down around 6.5% for the week and headed for a second week of declines, as hopes dim for a steady recovery in fuel demand amid signs of second-wave coronavirus outbreaks.
In the United States, stockpiles rose last week, against expectations, as refineries slowly returned to operations after production sites were shut down due to storms in the Gulf of Mexico and wider region.
US crude inventories rose 2 million barrels, compared with forecasts for a 1.3 million-barrel decrease in a Reuters poll.
In a further bearish sign, traders were starting to book tankers again to store crude oil and diesel, amid a stalled economic recovery as the Covid-19 pandemic continues unabated.
Onshore storage remains near capacity as supplies continue to outpace demand, so the use of so-called floating storage is back in vogue as cheap financing costs and the spread between contracts for delivery now and later months makes it favorable for traders to hold oil for later sale.

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