Oil futures fell Thursday, on track to snap a four-day winning streak, as the Colonial Pipeline resumes operations on the U.S. East Coast after shutting down in response to a ransomware attack.
Traders were also tracking a continued surge in COVID-19 cases in India, the world’s third-largest oil importer.
West Texas Intermediate crude for June delivery fell $1.54, or 2.3%, to $64.54 a barrel on the New York Mercantile Exchange. July Brent crude dropped $1.52, or 2.2%, to $67.80 a barrel on ICE Futures Europe.
June gasoline futures were down 2.1% at $2.1157 a gallon.
Colonial had shut down its pipeline, which provides around 45% of fuel needs to the East Coast, over the weekend after a ransomware attack. Gasoline shortages spread across the southeastern U.S. in the wake of the shutdown. Colonial late Wednesday said it had initiated the restart of pipeline operations late Wednesday, saying in a statement that “all lines, including those lateral lines that have been running manually, will return to normal operations.”
“Meanwhile, COVID cases in India remain elevated, which is affecting fuel consumption in the region,” said Sophie Griffiths, analyst at Oanda, in a note. “Fuel consumption, which is considered a proxy for oil demand fell 9.4% in April compared to March. The number highlights the impact that the COVID crisis and associated mobility restrictions are having on oil demand in the world’s third largest importer of oil.”