Oil jumps as investors remain hopeful of OPEC+ curbing supply
- 16 Nov 2020
Gulf Today Report
Oil prices rose on Monday regaining some losses with the prospect of OPEC+ holding current output curbs.
Brent crude futures for January advanced 54 cents or 1.3%, to $43.32 a barrel by 07:23 GMT. US West Texas Intermediate crude for December was at $40.76 a barrel up 63 cents. Or 1.6%.
Howie Lee, OCBC economist said, "fundamentally China's numbers do support why oil prices can keep at these levels."
The Brent and West Texas climbed above 8% on prospect of a vaccine for COVID-19 and OPEC+ maintaining lower output to support prices and boost the economy.
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OPEC+ has reduced production by 7.7 million barrels a day with a rate of 101% in October. It has plans on increasing output by 2 million bpd in 2021.
However, the speedy recovery of oil production in OPEC member Libya back to above 1.2 million bpd presents a challenge to OPEC+ cuts, while a slowdown in traffic across Europe and the United States dampened fuel demand recovery hopes this winter.
ANZ analysts are hopeful that the oil surplus will increase to 1.5 million and 3 million bpd in the first quarter of 2021 and a COVID-19 vaccine would increase demand in the second quarter.