Growing Number of COVID-19 Cases Causes Fear of Second Wave
June 15, 2020
The Baker Hughes Rig Count for oil rigs was down 7 on Friday putting total rigs at 199. Last year at this time there were 788 oil rigs in operation and the five year average is 672 and the five year high is 863. Rigs have fallen substantially, and production has started it decline which will eventually tightened up supplies.
The news is reporting more cases of covid creating a bit of fear that another round of the virus will impact the economic positives the economy has seen as states reopen. All of this can be debated; about whether another round will require shut down etc. But headlines are pushing new outbreaks and that is helping to create a negative impact that has helped energy price take a pause. Prices have corrected off recent highs and are trying to find a bottom for the new range that the markets could be stuck in here over the medium term.
New cases of covid has been report in China, which has been clear for two months, Japan, and the Unites States. Again, the reasons for this could be many but the headlines are creating the concerns that could impact economic activity which relates to energy demand.
The United States Oil Fund LP (USO) stated in a regulatory filing that it has gained approval to resume offering news shares. USO’s registration of 1 billion new shares has been declared effective by the Securities and Exchange Commission.
North Dakota’s Industrial Commission said the state’s oil production fell by 211,000 bpd to 1,219,000 bpd in April.
Reports indicate that China’s May refinery throughput was 13.6 million bpd, up 8.2 % from last year. The throughput rate was the second highest ever.
The news concerns for another wave of the virus is the hot news item that will be front and center for now.