Oil slips on rising Covid-19 cases

LONDON, Oct 20 (Reuters): Oil prices fell on Tuesday on worries that a resurgence of coronavirus cases globally is stifling a recovery in fuel demand while growing Libyan output adds to already plentiful supply.

Brent crude futures were trading down 34 cents, or 0.8 per cent, at $42.28 a barrel by 0903 GMT. US West Texas Intermediate (WTI) crude futures fell 15 cents, or 0.4 per cent, to $40.68.

COVID-19 cases topped 40 million on Monday, according to a Reuters tally, with a growing second wave in Europe and North America sparking various degrees of lockdown measures.

A meeting on Monday of a ministerial panel of the Organisation of the Petroleum Exporting Countries (OPEC) and its allies, together known as OPEC+, pledged to support the oil market as concerns grow over soaring coronavirus cases.

For now OPEC+ is sticking with a deal to curb output by 7.7 million barrels per day (bpd) to the end of the year and then increasing production by 2 million bpd in January.

"Monday's JMMC meeting failed to match market hopes of scrapping the planned output rise in January amidst an increasingly precarious demand environment," JBC Energy said.

OPEC watchers, including analysts from US bank J.P. Morgan, have said that a weak demand outlook could prompt OPEC+ to delay the reduction in curbs.

Reports from Moscow/Dubai add: OPEC and allied producers on Monday pledged action to support the oil market as concerns mounted that a second wave of the COVID-19 pandemic will hobble demand and an earlier plan to raise output from next year would further depress prices.

Saudi Arabia, the biggest member of the Organisation of the Petroleum Exporting Countries (OPEC), said no-one should doubt the group's commitment to providing support, while three sources from producing countries said a planned output increase from January could be reversed if necessary.

Already Russian President Vladimir Putin and Saudi Arabia's Crown Prince Mohammed bin Salman held two phone calls last week. Kremlin Dmitry Peskov spokesman said regular contact was necessary as the markets were volatile. OPEC and its allies, including Russia, collectively known as OPEC+, have curbed output since January 2017 to try to support prices and reduce inventories.