Oil: Corona virus should keep oil under pressure at least until summer, no matter what OPEC does, here's why

Even if OPEC cuts production by 500,000 barrels a day, oil prices could remain weak until May, according to an analyst at S&P Global Plats.

That's because stocks are rising as demand for oil declines due to the virus outbreak, Kung Wu, head of analytics, said on Thursday.

Oil prices are under pressure from the virus, which has shut down China-based companies for weeks and forced flight cancellations everywhere.

As the economic impact of the virus was felt, the Organization of the Petroleum Exporting Countries reduced its outlook for global oil demand. For China, where the outbreak began, OPEC revised its demand forecast by 0.2 million barrels per day for the first half of the year.

International benchmark Brent crude futures were at $52.79 a barrel, down 1.14% Thursday afternoon in Asia, while U.S. crude futures fell 1.29% to $47.99 a barrel.

The first infections surfaced in Wuhan, and the virus has since killed nearly 2,750 people in China. It has also spread around the world, with cases in Iran and Italy surging this week.

OPEC's joint technical committee met in early February and reportedly recommended a 500,000-barrel-per-day reduction.

That is what S&P Global Platts expects at the 5-6 March OPEC meeting, Wu says.

"Saudi Arabia is a key player, they are already too compliant," he said. "So the 500,000 barrels a day will add to that supply constraint, and bring some support to the market."

However, the current buildup of stocks may have to be absorbed next month, he says. "In terms of prices, (the market) could still be weak for the next 2 months, before improving in the summer."