Oil drops after Trump's COVID bombshell

Illustration: Sarah Grillo/Axios

Oil prices fell following President Trump's middle-of-the-night announcement that he tested positive for COVID-19, adding another source of uncertainty to the market.

Where it stands: WTI is down well over 3% to the mid-$37-ish per barrel this morning after earlier dropping into the high-$36 range, while the global benchmark Brent crude has slipped back under $40.

Why it matters: Oil prices already faced downward pressure from the virus' persistence and, per Reuters, the U.S. impasse over stimulus talks.

  • Crude's recovery from its spring depths has already been stalled for months as the pandemic's staying power hinders the pace of the demand revival.
  • WTI has largely been hanging around the low-$40s range at best since June, a level that ensures continued financial jeopardy for producers.

What they're saying: “Having already had to deal with growing concerns over the demand outlook, the oil market has been unable to escape the broader market sell-off following President Trump’s positive Covid-19 test result,” ING Bank NV analyst Warren Patterson tells Bloomberg.

The big picture: Via AP, "The positive test reading for the leader of the world’s largest economy heaps uncertainty onto a growing pile of unknowns investors are grappling with, first among them how it might affect the Nov. 3 election and American policies on trade, tariffs and many other issues beyond then."

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