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Oil prices have edged up after investors snapped up bargains when crude dropped nearly 4% in the previous trading session.
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However, gains were capped by fears of Covid-19 spreading beyond China and adversely affecting fuel demand.
According to Reuters, Brent crude rose $0.49 to $56.79 a barrel. The US West Texas Intermediate (WTI) crude gained $0.42 to $51.85 a barrel.
As of the end of 24 February, the death toll from the virus has increased to more than 2,700. The total number of recoveries from the infection has risen to more than 27,000 globally.
However, the new coronavirus has led to surges of infections in other parts of the world. Regions of South Korea and Italy are among those hit by the virus.
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By GlobalDataReuters quoted CMC Markets chief market strategist Michael McCarthy as saying: “Because we’ve seen a very significant fall in case of West Texas, from above $60 to touch below $50 (over the past six weeks), I think oil has largely reflected a lot of risk, unlike other markets.
“For this week, key factors are coronavirus, inventory data and the technical picture.”
Early results of a poll by the news agency show US crude oil inventories building for a fifth week in a row. At the same time, it showed stocks of refined products were likely to have decreased.
It noted that the current outbreak of coronavirus has infected ten times more people than the 2002-03 SARS coronavirus.
Meanwhile, Saudi Aramco chief executive Amin Nasser told Reuters that he expects the Covid-19 impact on oil demand to be brief. He, however, expects a rise in oil consumption in the second half of this year.
