Oil prices were little changed on Monday as concerns of falling fuel demand caused by the economic fallout from the coronavirus outbreak in China was offset by expectations that output cuts from major producers will tighten crude supply. Brent crude was at $57.27 a barrel, down 5 cents by 0541 GMT after rising 5.2% last week, the biggest weekly gain since September 2019. US West Texas Intermediate crude rose 8 cents to $52.13 a barrel, after a 3.4% gain last week. Japan, the world’s fourth-largest oil consumer, reported an economic contraction of 6.3% for the October to December period and there is an expectation of a further contraction in the January to March quarter because of the contagion. Singapore, whose trade-dependent economy is a barometer for the region, also warned of the potential for a recession this quarter because of the outbreak. “Oil remains acutely vulnerable to both excess supply and the economic coronavirus-induced slowdown in China and other parts of Asia,” Jeffrey Halley, a senior market analyst at OANDA in Singapore said. The International Energy Agency (IEA) said last week the virus is set to cause oil demand to fall by 435,000 barrels per day (bpd) in the first quarter of 2020 from the same period a year ago, in what would be the first quarterly drop since the financial crisis in 2009.
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