Oil prices decline on demand worries

Gulf Today Report 

Oil prices dropped below 2% on concerns of new restrictions affecting demand for oil products and blockage of the Suez Canal.

Brent crude futures slid $1.33, or 2.1%, to $63.08 a barrel at 05:59 GMT while US West Texas Intermediate (WTI) crude futures dropped by $1.40, or 2.3%, to $59.78 a barrel, after climbing 5.9% overnight.

Earlier in the week, prices declined due to tighter pandemic restrictions in Europe, it sharply reversed on Wednesday after the news of the grounding in the Suez Canal, potentially blocking 10 tankers carrying 13 million barrels of oil. 

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According to ING Economics, "the longer this disruption lasts the more likely we see refiners (and) buyers having to turn to the spot market to ensure supply from elsewhere."

Data showing US gasoline demand improved and refinery run rates improving supported the market.

Given the persistent demand worries and falling prices, expectations are growing that the Organization of the Petroleum Exporting Countries and allies, together called OPEC+, will rollover their current supply curbs into May at a meeting scheduled for April 1, four OPEC+ sources said.