Oil prices ease on doubts over US stimulus

Gulf Today Report 

Oil prices fall on Tuesday as market hope for rapid approval of new US economic stimulus diminishes and coronavirus infections surge.

Brent crude was down 15 cents at $55.73 while US crude was also lower, dropping 5 cents to $52.72.

Oil is currently battling between doubt over demand recovery and optimism for more US stimulus to support the economy as vaccines are rolled out.

In a note, Citigroup said, "through 2021, major supply and demand risks remain that threaten to jolt fundamentals into a much tighter or looser market." 

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European nations have toughened their restrictions to curtail the virus while China is reporting new COVID-19 cases, overshadowing the prospects of demand in the world’s largest energy consumer.

However, in some parts of the world, the demand for oil is soaring. In India, crude oil imports increased to their highest level in more than two years due to the easing of coronavirus restrictions.

On the supply side, compliance by the Organization of the Petroleum Exporting Countries and its allies on pledged oil output curbs is averaging 85% in January, tanker tracker Petro-Logistics said on Monday.