Tag Archives: Mitch McConnell

U.S. Democrats set showdown with Republicans on federal debt limit

WASHINGTON (Reuters) -The top Democrats in the U.S. Congress on Monday said they would aim to continue funding the government and increase its borrowing authority in a single bill in coming days, setting up a showdown with Republicans who have vowed not to approve more debt.

House of Representatives Speaker Nancy Pelosi and Senate Majority Leader Chuck Schumer said the bill, which must pass by Oct. 1 to avoid the third partial government shutdown in the past decade, would also suspend the nation’s borrowing limit until after the 2022 elections that will determine which party controls Congress.

But with Senate Republicans vowing to oppose any increase in federal borrowing authority, the two parties are engaging in a dangerous game that could cause widespread government disruptions or at the very least rattle financial markets until a deal is reached.

Democratic Senator Patrick Leahy, who chairs the Senate Appropriations Committee with oversight of government spending, told reporters that with 60 votes needed in that chamber to advance legislation and with Republicans in opposition, there likely are not the votes to pass the combined measures.

“I’m not sure what’s going to happen,” Leahy said.

Democrats so far have rebuffed Senate Republican Leader Mitch McConnell’s suggestion that the debt limit be linked to a $3.5 trillion budget reconciliation bill that Democrats hope to pass without any Republican support under a special procedure.

Democrats insist that the debt limit increase should remain a bipartisan effort.

(Reporting by Doina Chiacu and Richard Cowan; Editing by Scott Malone, Chris Reese and David Gregorio)

Tempers flare in U.S. Congress as COVID-19 mask mandates return

By Doina Chiacu and Susan Cornwell

WASHINGTON (Reuters) -Tempers flared in the U.S. Congress on Wednesday after its chief physician urged lawmakers to resume wearing masks to slow the spread of the highly contagious Delta variant of COVID-19, with the top Democrat labeling Republican opposition as “moronic.”

A high-ranking aide to House of Representatives Speaker Nancy Pelosi stopped short of confirming a report based on garbled audio that Pelosi called her Republican counterpart “such a moron” because of his opposition to the new directive.

“The Speaker believes that saying a mask requirement is ‘not a decision based on science’ is moronic,” Drew Hammill, deputy chief of staff for House Speaker Nancy Pelosi, said in a tweet.

Hammill was referring to a tweet by McCarthy in which he said, “Make no mistake – The threat of bringing masks back is not a decision based on science, but a decision conjured up by liberal government officials who want to continue to live in a perpetual pandemic state.”

The high-level spat came as COVID-19 cases in recent days have been rising, along with deaths, across the United States.

Since early in the pandemic, mask-wearing and vaccinations have been U.S. political flashpoints, with Republicans resisting and Democrats urging compliance with medical advice.

Many Republicans have complained that such government edicts infringe on individual liberties.

Late on Tuesday, Dr. Brian Monahan, the attending physician for Congress, required the use of masks indoors where people are congregating. It followed a similar move by the White House after the Centers for Disease Control and Prevention issued new mask recommendations to stem the spread of the new variant.

“Mask and vaccine mandates: Bullying, Controlling, Unconstitutional, Threats to Liberty!” Republican Representative Jody Hice of Georgia tweeted on Wednesday morning.

Some 57.6% of Americans have received at least one dose of COVID-19 vaccine, with the lowest rates across the heavily Republican U.S. Southeast. Four of the five U.S. states with the lowest vaccination rates have Republican governors: Mississippi, Idaho, Wyoming and Alaska, according to a Reuters COVID tracker. The governor of the fifth state, Louisiana, is a Democrat.

The top Senate Republican, Mitch McConnell, is rolling out a campaign ad in his home state of Kentucky to counter what he called “bad advice” prompting some Americans to opt not to get vaccinated.

“For the Congress, representing a collection of individuals traveling weekly from various risk areas (both high and low rates of disease transmission), all individuals should wear a well-fitted, medical-grade filtration mask … when they are in an interior space,” Dr. Monahan said in a memo late Tuesday.

The rule applies to all House of Representatives office buildings, in the hall of the House and in committee meetings, he said.

Even before the recommendation, many congressional Democrats had resumed wearing masks in the Capitol this week.

At her weekly news conference, Pelosi attempted to cool passions somewhat by refusing to comment directly on whether McCarthy’s position was “moronic.” Instead, in response to a reporter’s question, Pelosi said, “To say that wearing a mask is not based on science, I think is not wise.”

Throughout the pandemic, the 100-member Senate and the 435-member House have taken different precautions to contain COVID-19 infections in the sprawling Capitol.

Monahan’s latest directive did not require renewed mask-wearing on the Senate side of the Capitol – a decision that did not escape McCarthy.

“If she (Pelosi) knows so much about science explain to me where the science changes in the Rotunda,” McCarthy said of the massive room that separates the House and Senate.

(Reporting by Susan Cornwell, David Morgan and Doina Chiacu; Writing by Richard Cowan; Editing by Scott Malone, Jonathan Oatis and Richard Chang)

In Wisconsin, Biden says infrastructure plan would create millions of jobs

By Andrea Shalal

LA CROSSE, Wis. (Reuters) -U.S. President Joe Biden promoted his $1.2 trillion infrastructure package as a “generational investment” on Tuesday as he sought to pump up support for a plan that is in need of wide support in Congress to become reality.

Biden visited a public transit facility in La Crosse, a city in western Wisconsin, highlighting the plan’s investment of some $48.5 billion in public transit to reduce commute times and help reduce emissions, while boosting economic growth and wages.

In a speech, he spoke about local gains from the deal, including funds for electric buses, replacement of some 80,000 lead water lines in Milwaukee and better access to high-speed internet.

The bipartisan package also includes $109 billion in funding for roads, bridges and other major projects, including the 1,000 bridges rated structurally deficient in Wisconsin.

“This is a generational investment to modernize our infrastructure, creating millions of good-paying jobs, and position America to compete with the rest of the world in the 21st century,” said Biden.

He also noted that the plan will not hike tax on gasoline or raise taxes on Americans earning under $400,000 a year.

Vowing the plan would create jobs for middle-class people, Biden said: “This is a blue-collar blueprint to rebuild America.”

Biden is attempting to keep up the momentum for a legislative proposal that Democratic congressional leaders believe will reach a critical stage in the second half of July.

“I expect the last two weeks of July to be very busy weeks, when we will deal with the president’s proposals,” the No. 2 House Democrat, Steny Hoyer, told reporters on Tuesday.

House and Senate Democrats hope to have infrastructure legislation done and on its way to Biden’s desk by the end of September, a Democratic aide said.

Senate Democrats are aiming to pass bipartisan legislation and send it to the House, before breaking for an August recess.

Biden, under massive pressure from Republicans, on Saturday withdrew a threat to not sign the bipartisan bill unless it was accompanied by a separate package focused on what he calls “human infrastructure,” including expanded home care for the elderly and disabled.

Press secretary Jen Psaki told reporters on Monday that the White House had been in touch with Democratic leaders about the two measures but Biden had not spoken about the issue with U.S. Senate Republican leader Mitch McConnell, who wants Democrats in Congress to abandon their plan to link the two measures.

With the Senate divided 50-50 between the two parties, a move by McConnell against the bipartisan bill could cost it the 60 votes it would need to pass under Senate rules. Democrats aim to pass the companion measure through a process called reconciliation that requires a simple majority.

Psaki said Biden’s trip to Wisconsin was intended to convince Americans about the importance of both packages. He will also travel to Michigan on Saturday.

(Reporting by Andrea Shalal, Additional reporting by Jeff Mason and Steve Holland; Editing by Himani Sarkar, Steve Orlofsky and Cynthia Osterman)

U.S. Senate’s McConnell opposes Capitol attack panel; House set to vote

By Richard Cowan

WASHINGTON (Reuters) -Just hours before the U.S. House of Representatives was expected to vote to approve the formation of a commission to investigate the deadly Jan. 6 Capitol attack by Donald Trump’s supporters, the Senate’s top Republican set up a major roadblock by announcing his opposition to the proposal.

Speaking on the Senate floor, Minority Leader Mitch McConnell said, “I have made the decision to oppose the House Democrats’ slanted and unbalanced proposal for another commission to study the events of Jan. 6.”

Referring to existing congressional investigations and the previous arrests of hundreds of people in connection with the riot, McConnell slammed the door on further negotiations on establishing an independent commission to investigate the matter.

“There will continue to be no shortage of robust investigations,” McConnell said.

In the evenly split Senate, Republicans can block the legislation. At least 60 votes are needed to advance most bills in the 100-member Senate.

Senate Democratic Leader Chuck Schumer said he will schedule a debate on the legislation, calling an independent investigation necessary. At least two Republican senators – Lisa Murkowski and Mitt Romney – have signaled support, according to media reports.

Republican leaders in the House also oppose the Democratic-backed House bill. Democrats narrowly control the House and expect to pass the measure even if they do not draw much Republican support.

Multiple senior Republicans on Tuesday objected to the formation of a commission, whose proposed investigation could scrutinize Trump’s role in inspiring the attack with false claims that last year’s presidential election was stolen from him through widespread voting fraud.

The 10-member panel would be modeled after a bipartisan commission created to investigate the Sept. 11, 2001, attacks on the United States by al Qaeda militants. It would face a Dec. 31 deadline to produce a public report, including recommendations for preventing another attack on the Capitol.

Trump on Tuesday urged Republicans to vote against the proposal, calling it a “trap” inspired by “the radical left.” House Republican Leader Kevin McCarthy, who spoke with Trump by telephone Jan. 6 and announced his opposition to the commission on Tuesday, could also be a key witness for the commission.

The commission would be charged with looking at security and intelligence failures surrounding Jan. 6, when Trump’s supporters stormed the Capitol in a riot that left five people dead. The mob interrupted the formal congressional certification of Democrat Joe Biden’s victory over Trump in the November election.

Congressional Republicans risk drawing Trump’s ire if they vote for the commission, which could call the former president as a witness to explain his actions including an incendiary speech to supporters shortly before the riot. Opposing the commission could alienate independent voters troubled by the violence.

Some lawmakers fear that a failure to create an independent commission could hurt chances that the U.S. public will learn the full story about the effort to overturn the results of the 2020 election.

“An independent 9/11-style review is critical to removing the politics surrounding Jan. 6,” Republican Representative John Katko told the House Rules Committee on Tuesday.

Katko, a co-sponsor of the legislation, added, “This is about facts, it’s not about partisan politics.”

House Homeland Security Committee Chairman Bennie Thompson, a Democrat who crafted the bipartisan measure with Katko, on Wednesday told MSNBC he was optimistic the bill would be approved by the House and Senate.

McCarthy and McConnell have complained that the commission should do more than concentrate on Jan. 6 by investigating other “political violence.” Some Republicans want an investigation of the shooting of Republican congressman Steve Scalise during a practice at a baseball field in 2017 that left him gravely wounded and of protests in many U.S. cities last year against racism and police brutality.

(Reporting by Richard Cowan; Additional reporting by Susan Heavey; Editing by Will Dunham and Scott Malone)

Filibuster face-off: Schumer, McConnell at loggerheads over U.S. Senate power sharing

By Susan Cornwell

WASHINGTON (Reuters) – A standoff between new U.S. Senate Majority Leader Chuck Schumer, a Democrat, and the man he replaced, Republican Mitch McConnell, over a core rule of Senate operations has kept the two from reaching a deal on how to manage the 50-50 chamber.

Schumer is resisting McConnell’s demand for a promise to protect the long-standing Senate rule requiring a supermajority of 60 votes to advance most legislation, known as the legislative filibuster.

Their argument is holding up the basic organization and work of the Senate as it begins the new year with 50 senators from each party. Committees have not reorganized to accommodate new members.

“Things are on hold. I’ve got a lot of things I want to do,” the Senate’s No. 2 Democrat, Dick Durbin, told reporters on Thursday.

Democrats have the majority in the Senate because the new vice president, Democrat Kamala Harris, can vote in case of a tie.

But she cannot be expected to be there every day to decide every dispute. So Schumer and McConnell started talking earlier this week about a possible power-sharing deal governing daily operations, similar to a deal struck two decades ago when the Senate also had a 50-50 split.

McConnell is pushing for a commitment from Schumer to protect the filibuster, which some progressive Democrats have suggested should be ditched so that Democrats can pass their agenda without Republican support.

“I cannot imagine the Democratic leader would rather hold up the power-sharing agreement than simply reaffirm that his side won’t be breaking this standing rule of the Senate,” McConnell said Thursday.

Democrats could unilaterally change the rule to require only a simple majority for legislation to advance, if all 50 Democrats plus Harris agreed to do so, a gambit sometimes called the “nuclear option.” In recent years, the rules have been changed to allow most judicial and Cabinet nominations to advance with a simple majority, but not legislation.

Schumer is resisting McConnell’s demand, telling reporters on Thursday he did not want any “extraneous” provisions in the power-sharing deal.

Moderate Democrats like Senator Joe Manchin favor keeping the legislative filibuster. But even Manchin supports Schumer sticking to his guns and not making any promises to McConnell, keeping the threat of going “nuclear” on legislation in reserve if Republicans do not work cooperatively.

“Chuck has the right to do what he’s doing,” Manchin told reporters this week. “He has the right to use that to leverage in whatever he wants to do.”

(Reporting by Susan Cornwell; Editing by Scott Malone and Peter Cooney)

Agreement elusive on U.S. coronavirus relief as bipartisan group releases plan details

By Susan Cornwell

WASHINGTON (Reuters) – U.S. Senate Majority Leader Mitch McConnell said on Wednesday that lawmakers were still striving for agreement on COVID-19 aid, as a bipartisan group released details of their proposal and the U.S. House of Representatives prepared to vote on a one-week funding bill to provide more time for a deal.

With agreement elusive, the House was poised to vote on Wednesday afternoon on a measure to prevent federal programs from running out of money on Friday at midnight (0500 GMT on Saturday) by extending current funding levels until Dec. 18.

The move gives Congress seven more days to enact a broader, $1.4 trillion “omnibus” spending measure, to which congressional leaders hope to attach the long-awaited COVID-19 relief package – if they can reach a deal on both fronts.

The bipartisan group of lawmakers from the House and Senate released a summary of their $908 billion plan aimed at breaking the months-long stalemate between the parties over more coronavirus relief.

The proposal would extend for 16 weeks pandemic-related unemployment insurance programs due to expire at the end of the month. The measure would also provide an extra $300 a week in supplemental unemployment benefits for 16 weeks, from the end of December into April.

“We are literally on the five-yard line now,” said Democratic Representative Josh Gottheimer, a member of the bipartisan group. “We have no choice but to get this done.”

The summary said there was agreement in principle on two thorny issues: liability protections for businesses desired by Republicans and $160 billion in aid to state and local governments sought by Democrats. Lawmakers said they were still working on details.

On Tuesday evening, Treasury Secretary Steven Mnuchin weighed in for the first time since before the November election, saying he had presented a $916 billion relief proposal to Pelosi that includes money for state and local governments and liability protections for businesses.

But Pelosi and Schumer said they viewed the bipartisan negotiations as the best hope for COVID-19 relief.

Other Democrats also reacted cautiously to Mnuchin’s proposal, asking why it lacked supplementary benefits for the unemployed while including direct checks of $600 for all individuals.

“How can anybody say that I’m gonna send another check to people that already have a paycheck and job, and not send anything to the unemployed? It doesn’t make any sense to me at all,” said Senator Joe Manchin, a member of the bipartisan group, told reporters.

After the vote Wednesday on the stopgap funding measure in the Democratic-run House, the Republican-led Senate is expected to follow by the end of the week, then send the measure to President Donald Trump to sign into law.

Congress approved $3 trillion in aid in the spring to mitigate the effects of shutdowns to curb the spread of the coronavirus, but legislators have not been able to agree on any additional help since.

The pandemic has roared back to levels surpassing those seen early in the crisis, with more than 200,000 new infections reported each day and fresh shutdowns in some areas. More than 287,000 Americans have died of COVID-19 so far, and millions have been thrown out of work.

(Reporting by Susan Cornwell, David Morgan and Richard Cowan; Editing by Sonya Hepinstall, Peter Cooney, Jonathan Oatis and Cynthia Osterman)

Congressional COVID-19 impasse continues, Pelosi warns ‘house is burning down’

By Susan Cornwell

WASHINGTON (Reuters) – Top Democrats in the U.S. Congress on Thursday urged renewed negotiations over a multitrillion-dollar coronavirus aid proposal, but the top Republican immediately rejected their approach as too expensive, continuing a months-long impasse.

House of Representatives Speaker Nancy Pelosi and Senate Democratic leader Chuck Schumer ticked off a litany of grim data about the spread of the coronavirus in the United States, with eight straight days of over 100,000 new coronavirus cases being reported each day.

“It’s like the house is burning down and they just refuse to throw water on it,” Pelosi said of Republicans.

She and Schumer told a news conference that President-elect Joe Biden’s victory strengthened the Democratic position, which is to spend at least $2.2 trillion on another round of coronavirus aid, on top of the $3 trillion Congress has approved since the pandemic began. Republican President Donald Trump has not conceded to Biden.

“We’re willing to sit down and talk; they haven’t wanted to talk,” Schumer said, referring to the post-election session of Congress that lasts until the end of the year.

Senate Majority Leader Mitch McConnell, speaking to reporters in a hallway a few minutes later, said he preferred previous Republican proposals in the range of $500 billion, which he said would be aimed at the “residual problems.”

“I gather she (Pelosi) and the Democratic leader in the Senate still are looking at something dramatically larger. That’s not a place I think we’re willing to go,” McConnell said.

“But I do think there needs to another package,” the Republican said. “Hopefully we can get past the impasse.”

A senior official in Trump’s administration said it was leaving any negotiations about a coronavirus relief package to McConnell and Pelosi for the time being. But there was no sign such talks were imminent. Treasury Secretary Steven Mnuchin negotiated unsuccessfully with Pelosi for several weeks earlier in the fall.

Pelosi and Schumer spoke with Biden on Thursday by phone and the three “discussed the urgent need for the Congress to come together in the lame duck session on a bipartisan basis” to pass more coronavirus relief, a statement from Biden’s transition team said.

The bill should include resources to fight the pandemic, relief for working families and small businesses, support for state and local governments, expanded unemployment insurance, and affordable healthcare for millions of families, the statement said.

The Democratic-majority House in May approved an additional $3.4 trillion in coronavirus aid, but it went nowhere in McConnell’s Senate, where Schumer’s Democrats blocked less expensive Republican proposals from floor action.

The longest-serving Republican in Congress, 87-year-old Representative Don Young, announced on Thursday that he had been infected with coronavirus, the latest of over 20 members of Congress to have been infected.

(Additional reporting by Doina Chiacu and Patricia Zengerle; Editing by Jonathan Oatis and Aurora Ellis)

Republicans back Trump’s right to challenge Biden victory

By Steve Holland and Simon Lewis

WASHINGTON/WILMINGTON, Del. (Reuters) – President Donald Trump will push ahead on Tuesday with longshot legal challenges to his election loss, as Republican U.S. lawmakers and state officials defended his right to do so.

Pennsylvania Republican state lawmakers called for an audit of results in the state that on Saturday enabled Democrat Joe Biden to secure the more than 270 votes in the Electoral College he needed to win the presidency.

Biden, the president-elect due to take office on Jan. 20, 2021, also leads Trump in the popular vote by more than 4.6 million votes, according to the latest count of ballots.

Trump has made baseless claims that fraud was marring the results. The count has been delayed by a surge in mail-in ballots prompted by voters’ desire to avoid infection from the coronavirus pandemic.

Judges have tossed out lawsuits in Michigan and Georgia, and experts say Trump’s legal efforts have little chance of changing the election result.

The leading Republican in Congress, Senate Majority Leader Mitch McConnell, on Monday carefully backed Trump, saying that he was “100% within his rights to look into allegations of irregularities,” without citing any evidence.

McConnell’s comments represent the thinking of most Senate Republicans for now, said a senior Senate Republican aide. “The position is tenable until it isn’t and might last for a week or two before it becomes untenable,” the aide said.

The dispute has slowed Biden’s preparations for governing.

A Trump appointee who heads the office charged with recognizing election results has yet to do so, preventing the Biden transition team from moving into federal government office space or accessing funds to hire staff.

The General Services Administrator Emily Murphy, appointed by Trump in 2017, has yet to determine that “a winner is clear,” a spokeswoman said. Biden’s team is considering legal action.

BARR MOVE PROMPTS RESIGNATION

U.S. Attorney General William Barr on Monday told federal prosecutors to “pursue substantial allegations” of irregularities of voting and the counting of ballots.

He also told them that “fanciful or far-fetched claims” should not be a basis for investigation. His letter did not indicate the Justice Department had uncovered voting irregularities affecting the outcome of the election.

Richard Pilger, who for years has served as director of the Election Crimes Branch in the Justice Department, said in an internal email he was resigning from his post after he read “the new policy and its ramifications”.

The previous Justice Department policy, designed to avoid interjecting the federal government into election campaigns, had discouraged overt investigations “until the election in question has been concluded, its results certified, and all recounts and election contests concluded.”

Biden’s campaign said Barr was fueling Trump’s far-fetched allegations of fraud.

“Those are the very kind of claims that the president and his lawyers are making unsuccessfully every day, as their lawsuits are laughed out of one court after another,” said Bob Bauer, a senior adviser to Biden.

A bipartisan group of six former U.S. Justice Department officials blasted Barr’s move.

“The voters decide the winner in an election, not the President, and not the Attorney General,” wrote the group, which includes Don Ayer, a deputy attorney general under former President George H.W. Bush.

“We have seen absolutely no evidence of anything that should get in the way of certification of the results, which is something the states handle, not the federal government.”

REPUBLICANS REMAIN LOYAL

Although a few Republicans have urged Trump to concede, the president still had the support of prominent party leaders who had yet to congratulate Biden.

Trump’s campaign on Monday filed a lawsuit to block Pennsylvania officials from certifying Biden’s victory in the battleground state, where the Democrat’s lead grew to more than 45,000 votes, or nearly 0.7 percentage points, with 98% of ballots counted on Tuesday morning.

It alleged the state’s mail-in voting system violated the U.S. Constitution by creating “an illegal two-tiered voting system” where voting in person was subject to more oversight than voting by mail.

“The Trump campaign’s latest filing is another attempt to throw out legal votes,” Pennsylvania Attorney General Josh Shapiro, a Democrat, said on Twitter.

Pennsylvania state Representative Dawn Keefer led a group of Republican state lawmakers on Tuesday in calling for a bipartisan investigation with subpoena powers to see if the “election was conducted fairly and lawfully.”

Asked about any evidence of fraud, Keefer told reporters, “We’ve just gotten a lot of allegations,” adding that “they’re too in the weeds” for her to know more without investigating.

Biden will give a speech on Tuesday defending the Affordable Care Act, the landmark healthcare law popularly known as Obamacare, as the U.S. Supreme Court heard arguments on a lawsuit backed by the Trump administration to invalidate it.

(Additional reporting by Steve Holland, Richard Cowan, Jan Wolfe, Sarah N. Lynch and Doina Chiacu in Washington, Simon Lewis in Wilmington, Delaware; Writing by John Whitesides; Editing by Scott Malone, Angus MacSwan, Chizu Nomiyama and Howard Goller

McConnell: Signs of economic recovery point to smaller COVID-19 stimulus

By David Morgan

WASHINGTON (Reuters) – U.S. Senate Majority Leader Mitch McConnell said on Friday that economic statistics, including a 1 percentage point drop in the unemployment rate, showed that Congress should enact a smaller coronavirus stimulus package that is highly targeted at the pandemic’s effects.

The Republican senator told a news conference in Kentucky that the fall to a 6.9% jobless rate, combined with recent evidence of overall economic growth, showed the U.S. economy is experiencing a dramatic recovery.

“I think it reinforces the argument that I’ve been making for the last few months, that something smaller – rather than throwing another $3 trillion at this issue – is more appropriate,” McConnell told reporters.

But his call for a narrow package was quickly rejected by House of Representatives Speaker Nancy Pelosi, a Democrat, who has been working to broker a COVID-19 stimulus deal near the $2 trillion mark with Treasury Secretary Steven Mnuchin.

“It doesn’t appeal to me at all, because they still have not agreed to crush the virus. If you don’t crush the virus, we’re still going to have to be dealing with the consequences of the virus,” Pelosi told a news conference on Capitol Hill.

“That isn’t anything that we should even be looking at. It wasn’t the right thing before,” she added.

Senate Republicans, who oppose a larger package, have twice failed to move forward with smaller legislation worth $500 billion due to Democratic opposition.

Pelosi insisted that any agreement must include effective support for testing, tracing and vaccine development, as well as aid to state and local governments. Trump and his Republican allies have balked at Democratic demands for state and local aid, calling it a bailout for Democratic-run states and cities.

(Reporting by David Morgan; editing by Jonathan Oatis)

Oil drops 3% as U.S. vote count continues and coronavirus cases rise

By Jessica Resnick-Ault

NEW YORK (Reuters) – Oil fell below $40 a barrel on Friday as drawn-out vote counting in the U.S. presidential election kept markets on edge and new lockdowns in Europe to halt surging COVID-19 infections sparked concern over the demand.

In the U.S. election, Democratic presidential candidate Joe Biden took the lead over President Donald Trump in Georgia and Pennsylvania on Friday, edging closer to winning the White House as a handful of states continue to count votes.

Three days after polls closed, Biden has a 253 to 214 lead in the state-by-state Electoral College vote that determines the winner, according to Edison Research. Winning Pennsylvania’s 20 electoral votes would put the former vice president over the 270 he needs to secure the presidency.

Coronavirus cases in the United States surged by at least 120,276 on Thursday, according to a Reuters tally, the second consecutive daily record rise as the outbreak spreads in every region.

Italy recorded its highest daily number of COVID-19 infections on Thursday while cases surged by at least 120,276 in the United States, the second consecutive daily record as the outbreak spreads across the country.

Brent crude fell $1.28, or 3.13%, to $39.65 by 11:33 a.m. EST (1633 GMT). U.S. West Texas Intermediate (WTI) dropped $1.24, or 3.08% to $39.65 a barrel.

Still, Brent was heading for a 6% weekly gain, and U.S. crude was up 4.5% on the week.

Diminishing prospects of a large U.S. stimulus package were also weighing on the market.

U.S. Senate Majority Leader Mitch McConnell said on Friday that economic statistics including a 1 percentage point drop in the U.S. unemployment rate showed that Congress should enact a smaller coronavirus stimulus package that is highly targeted at the effects of the pandemic.

“Crude oil is very sensitive to the stimulus expectations, which just took a hit for the worse,” said Bob Yawger, director of energy futures at Mizuho. “The coronavirus situation is as negative a demand indicator as you can get,” he said.

Providing some support, the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, a group known as OPEC+, could delay bringing back 2 million barrels per day of supply in January, given weaker demand after new lockdowns.

U.S. crude inventories plunged last week by 8 million barrels, against analyst expectations for an increase.

(Additional reporting by Aaron Sheldrick; Editing by David Goodman and Louise Heavens)