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Oil prices fell about 4% on Thursday as India’s coronavirus crisis deepened and a key U.S. fuel pipeline resumed operations, halting a rally that had lifted crude to an eight-week high after forecasts for a rebound in global demand later in the year.

Brent crude was down $2.74, or 3.9%, at $66.58 a barrel by 1:07 p.m. ET (1707 GMT,) after rising 1% on Wednesday. West Texas Intermediate (WTI) was down $2.86, or 4.3%, to $63.22 a barrel, having risen 1.2% in the previous session.

If the losses are sustained, both contracts would mark their biggest daily drops in percentage terms since early April.

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Prices also came under pressure as the stock market has been pressured by inflation concerns earlier in the week.

A surge in commodity prices, labor shortage and much stronger-than-expected consumer prices data this week have stoked inflation concerns that could force the U.S. Federal Reserve to raise interest rates.

Raising rates typically boosts the U.S. dollar, which in turn pressures oil prices because it makes crude more expensive for holders of other currencies.

“The oil complex is seeing a double whammy this morning from the reported restart of the Colonial pipeline and a major reduction in risk appetite that is spinning off an escalation of inflation worries that has spurred the plunge in the stock market,” said Jim Ritterbusch, president of Ritterbusch and Associates.

U.S. President Joe Biden said on Thursday that the Colonial Pipeline should be reaching full operational capacity right now and he expects to see fuel normalcy this weekend.

Fuel shortages had worsened in the southeastern United States after six days of shutdown of the Colonial Pipeline, the largest U.S. fuel pipeline network, following a ransomware attack.

In another bearish signal for oil demand, a variant of the coronavirus has swept through India, the world’s third-biggest importer of crude.

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Medical professionals have not been able to say when new infections will plateau and other countries are alarmed over the transmissibility of the variant that is now spreading worldwide.

“Concerns are growing that the untamed spread of the coronavirus in India and in Southeast Asia will dent oil demand,” PVM analysts said in a note.

“Its impact, however, is expected to be relatively brief and the second half of the year will see the healthy revival of oil demand growth.”

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