NEW YORK: Oil prices fell on Tuesday, reversing gains the previous session on talk the United States, Japan and India will release crude reserves to tame prices despite the threat of faltering demand as COVID-19 cases flare up in Europe.
The United States is expected to announce a loan of crude oil from its emergency stockpile on Tuesday as part of a plan it hashed out with major Asian energy consumers to lower energy prices, a Biden administration source familiar with the situation said, report agencies. Brent crude futures fell 67 cents, or 0.8%, to $79.03 a barrel at 0721 GMT, while U.S. West Texas Intermediate (WTI) crude futures fell 88 cents, or 1.2%, to $75.87 a barrel.
Brent and WTI had both risen 1% on Monday on reports the Organization of the Petroleum Exporting Countries, Russia and their allies, an alliance known as OPEC+, could adjust their plan to raise oil output if large consuming countries release crude from their reserves or if the pandemic dampens demand.
With talk of a coordinated crude release having succeeded in driving prices back below $80 a barrel and an actual release only expected to have a temporary impact, analysts are turning their attention to the potential hit to demand from a fourth wave of COVID-19 cases in Europe.