LONDON: Oil costs climbed on Tuesday as optimism that authorities stimulus will finally elevate international financial development and oil demand trumped considerations that renewed COVID-19 pandemic lockdowns globally are cooling gas consumption.
Brent crude futures for March rose 46 cents to $55.21 a barrel by 0916 GMT after slipping 35 cents within the earlier session.
“The notion that any retracement shall be fast as confidence in financial and oil demand restoration is unlikely to fade away,” mentioned PVM analysts in a word.
U.S. West Texas Intermediate crude was at $52.40 a barrel, up four cents. There was no settlement on Monday as U.S. markets had been closed for a public vacation. Entrance-month February WTI futures expire on Wednesday.
Traders are upbeat about demand in China, the world’s high crude oil importer, after information launched on Monday confirmed its refinery output rose 3% to a brand new file in 2020.
China additionally prevented an financial contraction final yr.
Traders are watching out for U.S. oil stock information from the business affiliation API, due in a while Tuesday. On Wednesday, U.S. President-elect Biden’s inauguration speech will doubtless give particulars on the nation’s $1.9 trillion help bundle.
The Worldwide Power Company minimize its outlook for oil demand in 2021, however pointed to a restoration in demand within the second half of the yr to an annual common of 96.6 million barrels per day.
“Border closures, social distancing measures and shutdowns…will proceed to constrain gas demand till vaccines are extra broadly distributed, most definitely solely by the second half of the yr,” it mentioned in its month-to-month report.
(Further reporting by Florence Tan, modifying by Louise Heavens)
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