Oil extended losses on Friday as it got caught up in a broad downward move in financial markets after President Donald Trump said he had tested positive for the Covid-19 virus. Futures in New York fell toward $37 a barrel, while global benchmark Brent dropped as much as 3.7%. The U.S. president announced that he and First Lady Melania Trump had tested positive for Covid-19, shortly after one of his closest aides, Hope Hicks, had fallen ill with the coronavirus. Asian stocks retreated, as did European and U.S. equity futures, while the dollar swung wildly.
Trump’s positive result will likely sharpen already intense attention on his handling of the pandemic as he campaigns for re-election against Democrat Joe Biden, who leads in national polls. Oil was already lower before the news as the chance of any more U.S. fiscal stimulus before the November election appeared to be fading after talks yielded no immediate breakthrough.
The coronavirus is resurgent in Europe and hasn’t been brought under control in big economies such as India, leading to a chorus of forecasters scaling back their estimates for when oil demand will get back to pre-virus levels. Still, the Organization of Petroleum Exporting Countries’ crude production was almost unchanged last month from August, according to a Bloomberg survey.
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