COVID and conflict: Gaza’s hospitals strained on two fronts

By Nidal al-Mughrabi

GAZA (Reuters) – Gaza’s hospitals were already struggling to cope with the COVID-19 pandemic before the conflict with Israel erupted last week. Now, medics say, they are being stretched further.

“The Ministry of Health is fighting on two fronts in the Gaza Strip – the coronavirus front and the other front, which is more difficult, is the injuries and the wounded,” said Marwan Abu Sada, the director of surgery in Gaza’s main Shifa hospital.

More than a week into fighting, with Palestinians pounded night and day by airstrikes and Israelis racing for refuge from rockets as sirens wail, Gaza’s doctors are battling to keep pace.

At Shifa, the biggest health facility among the 13 hospitals and 54 clinics serving the crowded enclave’s 2 million people, the number of intensive care beds has been doubled to 32 as the toll of those wounded from the conflict mounts.

Like the rest of the system, the 750-bed hospital faced shortages of medicines and equipment before fighting erupted on May 10 – blamed by medics on a blockade led by Israel and backed by Egypt, which shares a border with Gaza. Israel says its measures aim to stop arms reaching militants. “The list of essential medications and medical disposables suffered an acute shortage,” Abu Sada said.

It’s not just medicines in short supply. Fuel for generators that power Gaza’s hospitals – with main’s power too intermittent to be relied on – is also running out.

Israel says its blockade does not aim to stop medicines or other humanitarian supplies, and any shortages are the result of actions by Hamas, the Islamist group that has run Gaza since 2007, when the blockade was imposed.

“Hamas constructed a network of underground terror tunnels in Gaza underneath the homes of Palestinians, using funds meant for their health & welfare to expand Hamas’ terror machine instead,” Israel’s Foreign Ministry said on Twitter Monday.

Hamas has rejected the accusation.

Palestinians say 201 people have been killed in Gaza since the fighting started, with hundreds more hurt, including those wounded by shrapnel or injured by collapsing buildings.

Israel has reported 10 dead in the rocket salvoes, with many more injured, some directly by the blasts and others when dashing to safety. Some are in a critical condition.

“We have a very bad time over here,” said Racheli Malka, an Israeli living in Ashkelon, a city north of Gaza repeatedly hit by rockets. “I hope it will finish fast.”

Nearby, Israelis celebrated the Jewish festival of Shavuot in a synagogue that had a hole caused by a rocket strike.

The Israeli military said Hamas – regarded by Israel, the United States and European Union as a terrorist group – and others militants had fired about 3,150 rockets in the past week.

‘OLD EQUIPMENT, OLD BUILDINGS’

Sacha Bootsma, the head of the World Health Organization in Gaza, said COVID-19 had strained the enclave’s struggling system.

“Before COVID, the health system could be categorized as fragile because it has very old equipment, old buildings, a shortage of properly trained health staff and, of course, a chronic shortage of essential medicines,” she said.

Gaza has reported about 106,000 cases of COVID-19, or about 5.3% of the population, with 986 deaths, health official say.

While Israel has rolled out one of the fastest vaccination programs in the world, fully inoculating about 55% of its 9.3 million people, Gaza received about 110,000 doses, or enough for 55,000 people, health officials say, to be distributed among one of the most densely populated areas in the world.

One ward at Shifa, still marked “Corona Isolation Department”, has had to be turned into an intensive care unit for those injured in the conflict.

“We require more urgent support from international and relief institutions,” said Ashraf Al-Qidra, spokesman for the ministry of health, calling for medicines and ambulances.

For those living near Shifa hospital, the sound of ambulances wears on their already shattered nerves. “As long as we hear sirens we know it is not over yet,” said Karam Badr, 57.

Yet, healthcare workers keep the creaking medical facilities going. WHO’s Bootsma said scarce resources were still reaching those most in need.

“The resilience of the health system is remarkable,” she said.

(Reporting by Nidal al-Mughrabi in Gaza; Additional reporting by Eli Berlzon in Ashkelon; Writing by Edmund Blair; Editing by Alex Richardson)

Fiscal stimulus powers U.S. economic growth in first quarter

By Lucia Mutikani

WASHINGTON (Reuters) – U.S. economic growth accelerated in the first quarter as the government gave money to mostly lower-income households, fueling consumer spending and setting the course for what is expected to be the strongest performance this year in nearly four decades.

The government largesse also extended to businesses, especially in the high-contact services industry. The massive fiscal stimulus and easing anxiety over COVID-19, with all adult Americans now eligible for vaccination against the virus, have resulted in a faster economic rebound in the United States compared to its global rivals.

The second-fastest gross domestic product growth since the third quarter of 2003, reported by the Commerce Department on Thursday, left output just 0.9% shy of its level at the end of 2019. Economists expect a full recovery from the pandemic recession, which started in February 2020, in late 2023.

The report is a boost for President Joe Biden as he celebrated 100 days in the White House.

“In early 2021, the economy was served a strong cocktail of improving health conditions and rapid vaccinations along with a fizzy dose of fiscal stimulus and a steady flow of monetary policy support,” said Lydia Boussour, lead U.S. economist at Oxford Economics in New York. “Looking ahead, we foresee the economy’s spring bloom turning into a summer boom.”

GDP increased at a 6.4% annualized rate last quarter, the government said in its advance estimate for the first three months of the year. That followed a 4.3% growth rate in the fourth quarter. It was the biggest first-quarter increase in growth since 1984.

Economists polled by Reuters had forecast GDP growth would increase at a 6.1% pace in the January-March period.

Income at the disposal of households before accounting for inflation surged by a whopping $2.36 trillion after decreasing $402.1 billion in the fourth quarter. As result, consumer spending jumped at a 10.7% rate, boosted by purchases of motor vehicles, furniture, recreational goods and electronics. Consumers also dined out, stayed at hotels and gambled.

Consumer spending, which accounts for more than two-thirds of U.S. economic activity, grew at a 2.3% pace in the fourth quarter. Some of the stimulus money was stashed away, with savings ballooning to $4.12 trillion from $2.25 trillion in the fourth quarter. Economists estimate households have accumulated at least $2 trillion in excess savings during the pandemic.

The government has provided nearly $6 trillion in COVID-19 relief over the past year. Robust demand in the first quarter pushed against supply constraints, leading businesses to draw down inventories, limiting the rise in GDP growth.

Excluding inventories, government and trade, the economy grew at a 10.6% rate last quarter.

The rapidly accelerating growth could revive fears about the economy overheating. The Federal Reserve on Wednesday acknowledged the burgeoning domestic activity, but the U.S. central bank gave no sign it was ready to reduce its extraordinary support for the recovery.

The booming economy could also erode support among moderate Democrats for Biden’s ambitious economic agenda. Biden on Wednesday unveiled a sweeping $1.8 trillion package for families and education in his first joint speech to Congress. Republicans oppose more stimulus, now worried about swelling debt. The new package and an earlier infrastructure and jobs plan total around $4 trillion, rivaling the annual federal budget.

“The second quarter will be hotter, people have money to spend as they are able to go shopping and traveling again,” said Sung Won Sohn, a finance and economics professor at Loyola Marymount University in Los Angeles. “Production is being ramped up to rebuild inventories. President Biden and (Fed) Chairman (Jerome) Powell, do we need all the stimuli?”

U.S. stocks were mostly higher. The dollar was steady against a basket of currencies. U.S. Treasury prices fell.

POWERFUL MOMENTUM

Inflation has accelerated, but many economists, including Fed officials, expect it will be transitory as the labor market remains 8.4 million jobs below its peak in February 2020.

The labor market is gradually recovering. In a separate report on Thursday, the Labor Department said initial claims for state unemployment benefits fell 13,000 to a seasonally adjusted 553,000 during the week ended April 24.

While claims have dropped from a record 6.149 million in early April 2020, they are above the range of 200,000 to 250,000 that is viewed as consistent with a healthy labor market.

There were 16.6 million people receiving unemployment benefits in the first week of April.

“We’re still probably a couple years away from pre-pandemic employment levels, but based on the powerful economic momentum built up in the first quarter, we should return close to a fully-functioning economy in the second quarter,” said Robert Frick, corporate economist at Navy Federal Credit Union in Vienna, Virginia.

Economists forecast growth this year could top 7%, which would be the fastest since 1984. The economy contracted 3.5% in 2020, the worst performance in 74 years.

Growth in the first quarter was also driven by business spending on equipment, which posted a third straight quarter of double-digit expansion. But business investment in nonresidential structures fell for a sixth straight quarter as a rebound in mining exploration, shafts and wells was offset by a drop in commercial and healthcare buildings.

Residential investment contributed to GDP growth for a third straight quarter. But trade was a drag for the third consecutive quarter as some of the domestic demand was satiated with imports. Inventories were drawn down at a rate of 85.5 billion.

(Reporting by Lucia Mutikani; Editing by Chizu Nomiyama and Paul Simao)

Americas not behaving as if in midst of worsening COVID-19 crisis -regional health official warns

By Julia Symmes Cobb

BOGOTA (Reuters) -The Americas are not behaving like a region experiencing an ever-graver outbreak of COVID-19, the director of the Pan American Health Organization (PAHO) warned on Wednesday.

This rise in infections is alarming but not surprising given relaxed restrictions used to curb virus transmission, PAHO Director Carissa Etienne said at a weekly news conference, adding that vaccination will not be enough to stop this wave of contagion.

“Highly transmissible variants are spreading, and social distancing measures are not as strictly observed as before,” Etienne said. “We are not acting like a region in the midst of a worsening outbreak.”.

More people have been infected with COVID-19 in the region during the last seven days than during most weeks last year, Etienne noted, while weekly deaths outnumber those of any week in 2020.

More than 1.3 million people in the Americas were infected and nearly 36,000 died last week, PAHO said.

“There are simply not enough vaccines available to protect everyone in the countries at greatest risk,” Etienne said. “We need to stop transmission by any means possible with the tools we have at hand.”

It will be a few weeks before vaccine supplies normalize, Etienne said, adding that countries should continue to administer AstraZeneca’s vaccine as adverse effects are very rare.

Leaders at every level can play a crucial role by tightening measures at the first sign of mounting infections, she said.

“We’ve noted an obvious relaxation in the implementation of public health measures,” said COVID-19 incident manager Sylvain Aldighieri. Regardless of virus variant, COVID-19 has the capacity to overwhelm health systems, he said.

Countries with significant case increases should consider lockdown measures, though if outbreaks are already visible it may be too late, PAHO health emergencies director Ciro Ugarte said.

“It’s clearly necessary to consider these measures,” Ugarte said, adding that such measures should be localized and of very limited duration.

If COVID-19 is not controlled across the world, there exists a worst-case scenario where a new vaccine-resistant variant emerges, said PAHO sub-director Jarbas Barbosa.

(Reporting by Julia Symmes CobbEditing by Bill Berkrot)

Europe becomes first region to surpass 1 million COVID-19 deaths: Reuters tally

By Shaina Ahluwalia and Roshan Abraham

(Reuters) – Coronavirus-related deaths in the European region surpassed 1 million on Friday as vaccination efforts attempt to keep up with new variants causing a third wave of infections that could once again overwhelm hospitals.

Since the pandemic began, at least 37,221,978 infections and 1,000,062 deaths were reported in the European region, according to a Reuters tally.

The region, which includes 51 countries, has about 35.5% of all coronavirus deaths and 30.5% of all cases in the world. The region includes Russia, the United Kingdom, the 27 members of the European Union and other countries.

The European region has administered about 12 vaccine shots for every 100 people, behind the United States which has administered about 34 doses per 100 people, according to figures from Our World in Data. Israel leads the world in vaccination efforts with about 110 shots given for every 100 individuals. Some vaccines require two doses.

With the number of EU COVID-19 related deaths above 550,000 and less than a tenth of the population inoculated, European Commission head Ursula von der Leyen said the situation was worsening. “We see the crest of a third wave forming in member states, and we know that we need to accelerate the vaccination rates.”

On Wednesday, the European Union threatened to ban exports of COVID-19 vaccines to Britain to safeguard scarce doses for its own citizens.

The number of infections in Europe have started picking up, with France recently seeing its biggest one-day jump in cases since November. The region is currently reporting a million new cases about every six days.

As Germany plans to lift the lockdown and revive its economy, an expert at the Robert Koch Institute for infectious diseases said on Tuesday that the number of infections is rising exponentially, with the country entering a third wave of the pandemic.

As the European Union looks to meet its summer target of inoculating 70% of adults, at least 13 countries in the bloc have suspended or delayed using AstraZeneca’s COVID-19 vaccine after reports of blood coagulation in people who have received the shot.

Countries in eastern Europe, including Russia, remain the worst-affected based on the total number of cases and deaths.

Russia has the highest total number of COVID infections, with over 4.4 million or nearly 12% of all the cases in the region. The country has one of the highest COVID-19 fatality rates in the world on a per capita basis, with about 153 deaths per 100,0000 residents, behind the United States with 164 deaths for every 100,000 people.

While the official death toll in Russia stands at 94,267, at least 221,534 have perished due to the disease, according to a Reuters calculation which includes deaths reported by the country’s Rosstat statistics agency.

Italy became the third country in Europe to exceed more than 100,000 deaths last week. Prime Minister Mario Draghi warned that the situation would worsen again with a jump in hospitalizations.

The World Health Organization appealed to the governments not to pause vaccination campaigns, while the European Medicines Agency has said that the number of thromboembolic events in vaccinated people is no higher than the number seen in the general population.

(Reporting by Shaina Ahluwalia and Roshan Abraham in Bengaluru; Editing by Lisa Shumaker)

Fed’s Powell says support for economy needed for ‘some time’

By Howard Schneider

WASHINGTON (Reuters) – The U.S. economic recovery remains “uneven and far from complete” and it will be “some time” before the Federal Reserve considers changing policies it adopted to help the country back to full employment, Fed Chair Jerome Powell said on Tuesday.

The U.S. central bank’s interest rate cuts and purchases of $120 billion in monthly government bonds “have materially eased financial conditions and are providing substantial support to the economy,” Powell said in remarks prepared for delivery to a Senate Banking Committee hearing on the state of the economy.

“The economy is a long way from our employment and inflation goals, and it is likely to take some time for substantial further progress to be achieved,” the hurdle the Fed has set for discussing when it might be appropriate to pare back support.

While the health crisis in the country is improving and “ongoing vaccinations offer hope for a return to more normal conditions later this year,” Powell said, “the path of the economy continues to depend significantly on the course of the virus and the measures taken to control its spread.”

Powell’s appearance in Congress comes at a significant juncture for the U.S. economy, which is still reeling from the pandemic but perhaps poised to take off later this year if the vaccination program hits its stride.

The hearing before the Senate Banking Committee, one of the Fed chief’s mandated twice-a-year appearances on Capitol Hill, is Powell’s first since Democrats won the White House and control of both chambers of Congress.

After his opening remarks, Powell will field questions from senators who are likely to focus on the tension between a pandemic that has claimed more than half a million U.S. lives and left millions unemployed, and an economy flush with savings and central bank support, and about to get a fresh gusher of federal spending.

INFLATION DEBATE

The growing likelihood that Congress will pass President Joe Biden’s $1.9 trillion stimulus plan has raised concerns about a possible spike in inflation and overheating in asset markets, but Powell’s message to lawmakers will likely be a familiar one: don’t let off the gas.

Even with Americans being vaccinated at a rate of more than 1.5 million a day and coronavirus caseloads dropping, Powell and his fellow Fed policymakers are focused instead on the nearly 10 million jobs missing from the economy compared to a year ago, and the potent risks still posed by the virus.

They’ve pledged to keep interest rates low and use other monetary policy tools to speed up a labor market recovery. Two weeks ago, Powell pushed for a “society-wide commitment” to that goal – a nudge to lawmakers debating Biden’s stimulus plan.

The scale of the proposed stimulus, coming on the heels of about $4 trillion in federal aid and heavy bond purchases by the Fed last year, has flustered the feathers of inflation hawks and stoked criticism that the U.S. central bank has boosted prices of stocks and other assets to unsustainable levels.

Fed officials are united on that front. They don’t think inflation is a risk, and regard much of the recent rise in stock prices, for example, as a sign of markets’ confidence in a post-pandemic economic rebound, not an artificial run-up fueled by cheap money.

The hearing on Tuesday, which will be followed by Powell’s appearance before the House of Representatives Financial Services Committee on Wednesday, may also provide a gauge of his prospects of remaining Fed chief when his current four-year term expires early next year.

Biden will have to decide in coming months whether to reappoint Powell, who was chosen for the job by former President Donald Trump. The nomination is subject to Senate ratification.

(Reporting by Howard Schneider; Editing by Paul Simao)

COVID-19 surge takes toll on Portugal’s undertakers

By Catarina Demony

LISBON (Reuters) – Standing next to the sealed coffin of yet another COVID-19 victim in Portugal, funeral parlor worker Carlos Carneiro wept as the bereaved family played a record of a traditional fado song as a final goodbye.

Carneiro, 37, has been in the undertaking business for two decades helping people cope with loss, but never felt as affected by sorrow and fear as now.

Portugal fared better than others in Europe in the first wave of the pandemic in March-April, but the new year brought a devastating surge in infections and deaths, overwhelming the health service and funeral homes.

More than 14,700 people have died of COVID-19 in Portugal, with cumulative infections since the start of the pandemic at nearly 775,000.

“I have never felt this emotional, with so many consecutive funerals,” Carneiro told Reuters in a quavering voice outside the crematorium where the body of 77-year-old Matilde Firmino was turned into ashes.

“It’s hard on us. We feel it when we get home.”

Due to coronavirus rules in place to reduce the risk of contagion, funeral homes like Carneiro’s Funalcoitao near Lisbon had to quickly adapt.

Workers must wear protective gear from head to toe, bodies are placed inside white plastic bags and then in a coffin, without embalming or makeup.

Families are rarely able to see the deceased before they are buried or cremated, and Firmino’s daughter was at one point worried if it was really her mother inside the coffin.

A priest blessed the coffin in a short service held outside as family and friends sheltered from the pouring rain. “I ask God to free us from this pandemic we are living,” he said.

Carneiro said he always seeks to honor the lives of the dead, but not being able to give families the full closure they seek is taking a toll on his well-being.

“These people are not numbers…People sit on their sofas and worry about (coronavirus) numbers, but we see people and their families. We have to deal with the drama,” Carneiro said.

‘THERE’S FEAR’

His brother Alvaro, 44, said January, when Portugal reported almost half of all its COVID-19 deaths since the start of the pandemic, was the hardest month in his 24 years in the funeral business.

“We are scared of being infected, of infecting our family members at home,” he said at their family-run funeral home, which on Tuesday alone organized six services. “There’s fear.”

Funeral business associations have urged Portuguese authorities to vaccinate the sector’s around 5,000 workers as soon as possible.

“We are on the frontline so we should be considered a priority for vaccination but according to the news we are seeing there are not enough shots for everyone,” Alvaro Carneiro said. “We will have to endure this a little longer.”

A July 2020 article by two public health researchers said high death rates, restrictions, a fear of being infected and worries about their families’ wellbeing could affect funeral workers’ mental health, especially in the longer run after the daily pressure subsides.

(Reporting by Catarina Demony, Miguel Pereira and Pedro Nunes; Editing by Andrei Khalip and Angus MacSwan)

Pentagon to deploy 1,100 troops to help COVID-19 vaccination efforts

WASHINGTON (Reuters) – President Joe Biden’s administration on Friday announced that the Pentagon had approved the deployment of 1,100 active-duty troops to assist with COVID-19 vaccination efforts in the United States, a number likely to rise in the coming weeks and months.

The pandemic has killed more than 447,000 Americans and thrown millions out of work.

Andy Slavitt, senior adviser to the White House’s COVID-19 response team, said in a briefing that part of the group would start to arrive in California within the next 10 days.

The Pentagon said the 1,110 troops would be broken down into five teams, each with vaccinators, nurses and clinical staff.

The deployment is likely just the first tranche of U.S. military personnel assisting in administering vaccinations around the country.

White House Chief of Staff Ron Klain last week said the Federal Emergency Management Agency was working with the Pentagon to use 10,000 troops and open 100 centers across the country to increase the availability of vaccines.

Using the military to fight the coronavirus is not new. At its peak under former President Donald Trump, more than 47,000 National Guard troops were supporting COVID-19 operations and about 20,000 continue to help.

The Army Corps of Engineers has also built thousands of rooms across the country to assist hospitals with the strain caused by the spread of the coronavirus.

(Reporting by Idrees Ali; Editing by Dan Grebler)

Essential yet under vaccinated, some California farmworkers get their vaccines

By Norma Galeana and Alan Devall

MECCA, Calif. (Reuters) – Deemed an essential workforce during the pandemic, California’s mostly Latino farmworkers are also under represented in the state’s vaccination program, health officials and activists say, prompting the delivery of shots in the fields.

In one such campaign, public health officials vaccinated about 250 workers on Monday, including about 150 from Hadley’s Date Gardens, in the first of what they hope will be a weekly visit to agricultural lands.

“We’re essential for the country, to be able to feed the other families,” Maria Razo, 45, a date sorter, said from the vaccination site in Mecca, California, about 140 miles (225 km) east of Los Angeles.

“Now that we have it, we’re going to work a little safer,” Razo said after getting her first of two shots of the vaccine developed by Pfizer Inc and German partner BioNTech SE.

Though falling behind health workers and first responders in vaccination priority, farmworkers are critical to California’s agricultural industry, which accounts for a large chunk of the country’s food supply. Many lack the internet connectivity and transportation most Americans take for granted and use to get their shots.

With or without a vaccine, their jobs are dangerous enough. Date-pruners climb atop the fronds of the date palms with an extra long ladder, chopping away with a recurved machete to de-thorn the trees in preparation for harvest.

Early data shows Blacks and Latinos have been underrepresented in COVID-19 inoculations given to healthcare workers and nursing home residents, the U.S. Centers for Disease Control and Prevention said.

Moreover, California has lagged most other states in vaccinations administered per capita, CDC data show.

“We knew that this was going to be a community that was going to be disproportionately affected by COVID-19. So we designed this community-based strategy to bring resources to them,” said Conrado Bargaza, chief executive of Desert Healthcare, a public entity that provides healthcare services.

Riverside County health officials have worked with the Todec Legal Center, which provides legal advice and education for Latino immigrants in the inland area of Southern California, to take vaccines to the workforce.

“COVID has shed a light to all these inequalities that we have,” said Todec Executive Director Luz Gallegos, who has been combing the fields making sure farm workers get tested and vaccinated. “We’re talking about the most vulnerable workers.”

(Reporting by Norma Galeana and Alan Devall; Writing by Daniel Trotta; Editing by Bill Berkrot)

As pandemic worsens, Portugal reports nearly half of all its COVID-19 deaths in January

By Catarina Demony and Victoria Waldersee

LISBON (Reuters) – Portugal reported close to half of all its COVID-19 deaths in January, highlighting the severe worsening of the pandemic in a country whose plight has caused several European nations to offer help.

Hospitals across the nation of just over 10 million appear on the verge of collapse, with ambulances queuing sometimes for hours for lack of beds and some health units struggling to find enough refrigerated space to preserve the bodies of the deceased.

Austria is willing to take in intensive-care patients and is waiting for Portuguese authorities to propose how many patients they want to transfer, the Austrian embassy in Lisbon said.

Germany will send medical staff and equipment.

Hard-hit neighbor Spain has offered help too, but Portugal is yet to accept, a Spanish foreign ministry source told Reuters, while Foreign Minister Arancha Gonzalez Laya told LaSexta TV both countries were in “direct contact every day, at all levels”.

In January, 5,576 people died from COVID-19, representing 44.7% of all 12,482 fatalities since the start of the pandemic in Portugal, health authority DGS said.

Portuguese officials have blamed the huge increase in the infection and death rates on the more contagious variant of the disease first detected in Britain, while acknowledging that a relaxation of restrictions on social movement over the Christmas holidays played a role.

The association representing funeral homes warned that public hospitals were running out of refrigerated space to preserve the bodies of COVID-19 victims, and some, including Portugal’s largest hospital Santa Maria, have installed extra cold containers to ease pressure on their morgues.

Over 711,000 infections have been reported since March 2020, with 43% of those infections in January, according to DGS, whose tally increased by 275 deaths and 5,805 cases on Monday.

Portugal has the world’s highest seven-day rolling average of new daily cases per million inhabitants, according to data tracker ourworldindata.org.

With 865 coronavirus patients in intensive care and 6,869 in hospital wards, hospitals are running out of beds and there is a shortage of doctors and nurses.

Portugal has 850 ICU beds allocated to COVID-19 cases in its mainland public health system and another 420 for those with other ailments, according to the latest data.

For most, vaccination against the virus is the light at the end of the tunnel. But only roughly 70,000 people have been fully vaccinated with the two required doses so far. Those over 80 start getting their shots on Monday.

(Reporting by Sergio Goncalves, Catarina Demony and Victoria Waldersee; Additional reporting by Belen Carreno and Emma Pinedo Gonzalez in Madrid and Seythal, Thomas Seythal in Berlin; Editing by Ingrid Melander, Mark Heinrich and Bernadette Baum)

Oil slips on coronavirus fears, strong dollar

By Bozorgmehr Sharafedin

LONDON (Reuters) – Oil prices fell slightly on Monday as a stronger dollar, fears over soaring COVID-19 cases around the world and the slow pace of vaccination against the coronavirus outweighed a better-than-expected quarterly rebound for China’s economy.

Brent crude was down 23 cents, or 0.4%, at $54.87 per barrel at 1720 GMT, and West Texas Intermediate U.S. crude fell 19 cents, or 0.4%, to $52.17.

“Corona-induced economic fears, a stronger U.S. dollar and more pessimistic investor sentiment are all playing their part in the fact that Brent is trading … around $3 lower than last Wednesday,” said Commerzbank analyst Eugen Weinberg.

The benchmarks had rallied in the past few weeks, buoyed by COVID-19 vaccine rollouts and a surprise cut in output by Saudi Arabia. But the slow pace of vaccination has raised doubts over how soon economies could recover.

A UK official said Britain’s vaccine rollout was limited by a “lumpy” manufacturing process, and Pfizer Inc said it was distributing fewer doses of its vaccine in Europe in January than originally contracted.

“Vaccination campaigns, although ongoing, are lagging the speed needed to fast-track a global recovery in the first quarter and the comeback for oil demand will be slow,” said Rystad Energy’s head of oil markets Bjornar Tonhaugen.

The U.S. dollar strengthened for a third consecutive day on Monday to a four-week high, weighing on crude prices. Oil is usually priced in dollars, so a stronger dollar makes crude more expensive for buyers with other currencies.

Security concerns ahead of this week’s U.S. presidential inauguration are also dragging on investor sentiment, said PVM Oil analyst Tamas Varga.

“In addition to the coronavirus running amok, this week’s tense presidential inauguration can also cause unease amongst investors,” he said.

Oil prices clawed back some losses after Chinese data showed the economy of the world’s biggest oil importer picked up speed in its recovery from the pandemic.

Prices also found support in a drop in Libyan oil output, with Waha Oil Company reducing production by up to 200,000 barrels per day because of maintenance on the main pipeline that links the Al-Samah and Al-Dhahra oilfields to Es Sider port.

(Reporting by Bozorgmehr Sharafedin in London; Additional reporting by Aaron Sheldrick in Tokyo and Rod Nickel in Winnipeg, Manitoba; Editing by Jason Neely, Mark Potter and Jane Merriman)