Oil Demand Concerns Linger

Oil prices edged higher on Monday after Donald Trump, the embattled outgoing US president, signed a $2.3 trillion coronavirus aid and spending package, although lingering worries about near-term demand weighed on the market.
Brent crude futures added 12 cents, or 0.2%, at $51.41 a barrel, having fallen as much as 1.5% to $50.53 a barrel earlier in the session, newswires reported. US West Texas Intermediate crude futures rose 18 cents, or 0.4%, to $48.41 a barrel.
“With trading volumes thinned by the holiday week, oil is likely to remain below the radar in coming days. That said, the signing of the US stimulus bill, with the possibility of an increased size, should put a floor under oil prices in a shortened week,” said Jeffrey Halley, senior market analyst at OANDA.
Trump’s move was cheered as it would restore unemployment benefits to millions of Americans and avert a federal government shutdown.
Global shares climbed on Monday after he signed into law the pandemic aid package, backing down from his earlier threat to block the bipartisan bill.
But a new highly infectious variant of the coronavirus, which was first seen in Britain and has now been detected in several other countries, has led to mobility restrictions being reimposed, fueling concern over demand recovery.
The oil market will take cues from the virus situation as it develops in coming days, market watchers said.