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UPDATE 3-Oil falls as demand worries re-emerge, crews return to US Gulf rigs

Thu, 17th Sep 2020 05:01

* U.S. oil producers restart operations after storm

* Concerns about weak fuel demand back in focus

* OPEC+ panel warns of virus impact

* OPEC+ online meet due on Thursday
(Updates prices, adds analysts' comments, latest on OPEC, new
COVID cases, changes dateline to London)

By Bozorgmehr Sharafedin

LONDON, Sept 17 (Reuters) - Oil prices fell on Thursday as
U.S. producers in the Gulf of Mexico prepared to resume output
following Hurricane Sally, and on concerns about that the
coronavirus pandemic was showing few signs of slowing.

Brent crude fell 15 cents, or 0.4%, to $42.07 a
barrel at 0832 GMT, after climbing 4.2% on Wednesday.

U.S. West Texas Intermediate (WTI) crude was down 17
cents, or 0.4%, at $39.99 a barrel, after jumping 4.9% on
Wednesday.

U.S. energy companies were starting to return crews to
offshore oil platforms in the Gulf of Mexico after Hurricane
Sally halted operations for five days, shutting down output of
nearly 500,000 barrels per day (bpd).

"As producers prepare to resume production, oil prices are
retreating from yesterday’s price spike," said oil broker PVM's
Tamas Varga.

An OPEC+ technical panel warned that a rise in coronavirus
cases in some countries may curb oil demand despite signs of
economic recovery and initial indications of a decline in oil
stocks, according to an internal document seen by Reuters.

Global coronavirus cases are expected to pass 30 million on
Thursday, according to a Reuters tally.

Later on Thursday, OPEC and allies, led by Russia, are
scheduled to hold an online meeting to discuss compliance with
their agreed output cuts and demand trends amid falling oil
prices and a faltering economic recovery outlook.

"Mission is far from accomplished by OPEC+ and the need for
deeper cuts or reigning in sub-compliers to avoid global stock
builds returning is overarching," said Rystad Energy’s head of
oil markets Bjornar Tonhaugen.

"The market is fully aware of the strenuous situation in
the short term, hence sending prices a bit down today," he
added.
(Reporting by Bozorgmehr Sharafedin in London, additional
reporting by Sonali Paul in Melbourne and Roslan Khasawneh in
Singapore; Editing by Simon Cameron-Moore)

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