Oil prices fall on rising COVID-19 infections in Asia

Oil prices fall on rising COVID-19 infections in Asia

Oil prices fell for a second day on Wednesday on renewed demand concerns as coronavirus cases in Asia rise and on fears rising inflation might lead the U.S. Federal Reserve to raise interest rates, which could limit economic growth.

Brent crude futures fell 85 cents, or 1.2%, to $67.86 a barrel at 1005 GMT. It settled 1.1% lower on Tuesday after briefly climbing above $70 earlier in the session.

U.S. West Texas Intermediate (WTI) crude futures dropped 90 cents, or 1.3%, to $64.59 a barrel, following a 1.2% fall on Tuesday, Reuters reported.

Brent's rise to $70 was driven by optimism over the reopening of the U.S. and European economies, among the world's biggest oil consumers. But it later retreated on fears of slowing fuel demand in Asia as COVID-19 cases surge in India, Taiwan, Vietnam and Thailand, prompting a new wave of movement restrictions.

Uncertainties over inflation also prompted investors to reduce exposure to riskier assets like oil.

The Fed has indicated that interest rates will stay at their current low levels through 2023 though futures markets show investors believe rates may start to be raised by September 2022.