Oil consolidates above 2-week lows ahead of US inventories data

Oil prices continued to rise as the US market opened today, to head for the first daily gain in 4 day, within recovery attempts from a 2-week low, after the Saudi Minister of Energy reassured the market about the OPEC-Plus measures, but the gains remain ebbed due to lingering fears over the coronavirus outbreak in South Korea, the Middle East and Europe.

US crude rose to $52.01 a barrel, after opening at $51.32, and Brent crude rose to $56.96, after opening at $56.14.

The US crude lost 3.8% yesterday, to post its third daily loss and a 2-week low of $50.46, and Brent crude futures fell 3.9% and posted the lowest since February 13 at $55.16.

These sharp daily losses, which is largest since January 30, came after the rapid coronavirus spread beyond China escalated fears over weaker oil demand in the market.

Oil prices gained around 2% during the past week, to post the second straight weekly gain, after signs of a slowdown in coronavirus infections in China, US sanctions on Venezuela, and Libyan oil output drop.

The Saudi Energy Minister, Prince Abdulaziz bin Salman, expressed today that he is confident about the OPEC-Plus collation, but stressed that the organization has not take any decision regarding the cut agreement yet.

While most experts are almost certain OPEC-Plus will take measures to balance oil markets, due to pressures from the coronavirus outbreak.

CEO of the Saudi Oil Company Aramco, Amin Nasser, told Reuters on Monday that Aramco expects the coronavirus to have an impact on the short-term demand, as consumption will rise in the second half of this year.

China announced today the total of coronavirus infected cases rose to 80,000 cases, and its death toll rose to 2,500 victims, which is ten time larger than impact of the SARS virus in 2002/03.           

The American Petroleum Institute (API) will release later today its preliminary data on US crude inventories, with forecasts for inventories to rise for the fourth straight week, and the US Energy Information Administration will release the official report tomorrow.