Oil prices rise to highest level since March after Covid-19 vaccine news

24 November 2020 (Last Updated November 24th, 2020 11:55)

Oil prices have risen to hit the highest mark since March as encouraging news about a third promising vaccine created hopes of a swift recovery in fuel demand.

Oil prices rise to highest level since March after Covid-19 vaccine news
With the new gains, Brent crude hit its highest mark since March. Credit: Anita starzycka from Pixabay.

Oil prices have edged-up to hit the highest mark since March as encouraging news about a third promising vaccine created hopes of a swift recovery in fuel demand.

Brent crude futures rose by $0.34 to reach $46.40 a barrel while US West Texas Intermediate (WTI) futures were up by $0.38 to touch $43.43, Reuters reported.

It rose to the highest level traded since early March before Saudi Arabia announced a price war with Russia. The price war resulted in a crash of oil prices.

Both the Brent and the WTI benchmarks settled up at 2% on 23 November after rising 5% last week.

Financial services firm Axi chief global markets strategist Stephen Innes was quoted by the news agency as stating: “Progress on developing and distributing a vaccine de-risks the path back to normal for oil markets.

“If mobility data is a measure of oil price sentiment, in the not too distant future, the vaccine will get people back on airplanes and cruise ships.”

On 23 November, British drug-making firm AstraZeneca said that its vaccine could be more than 90% effective under a single dosing regimen. It was proven to be 70% effective in pivotal trials.

The company’s drug candidate is the world’s ‘third new weapon’ against the novel coronavirus, which the company claims is cheaper to make and easier to distribute.

Meanwhile, President Donald Trump allowed officials to ‘proceed with a transition’ to President-elect candidate Joe Biden.

On the supply side, OPEC+ will look at options to extend its agreement on output cuts by at least three months from January 2021 when the group meets on 30 November and 1 December.

The group intends to extend output cuts through next year to support prices amid a second wave of the virus.