Brent crude futures dropped $0.17 to trade at $44.17 a barrel. Credit: John R Perry from Pixabay.

Oil prices lost some earlier gains achieved from positive vaccine news, as a surge in Covid-19 cases renewed fears of weaker fuel demand.

Brent crude futures dropped $0.17 to $44.17 a barrel, while the US West Texas Intermediate crude declined $0.29 to trade at $41.53 a barrel, Reuters reported.

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Both oil benchmarks gained 1.4% and nearly 1% respectively on the previous day.

The Covid-19 death toll in the US crossed the 250,000 milestone this week as the country struggles to contain the spread of the virus.

The number of daily cases also reached new highs in the Japanese capital of Tokyo and South Korea.

South Australia imposed a state-wide lockdown after reporting a cluster of cases. The number of cases also surged in the Indian capital of New Delhi.

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Fujitomi chief analyst Kazuhiko Saito was quoted by the news agency as saying: “The spread of coronavirus infection and fresh restrictions in the US and other parts of the world hit market sentiment as it would hamper fuel demand.”

In previous sessions, oil prices improved after Pfizer said that its Covid-19 vaccine is around 95% effective.

Oil prices also received some support after the US reported a lower-than-expected increase in crude inventories.

The Organization of the Petroleum Exporting Countries (OPEC), Russia and other producers, together known as OPEC+, are also considering to delay plans that involve increasing output in January.

The group is set to discuss future policy at a full ministerial meeting to be held on 30 November and 1 December.