Oil prices further improve on expectations of US stimulus package

11 August 2020 (Last Updated August 11th, 2020 08:39)

Global oil prices have further improved riding on hopes of a new Covid-19 related stimulus package from the US to support the local industry.

Oil prices further improve on expectations of US stimulus package
Brent crude climbed 22 cents to $45.21 per barrel. Credit: Bureau of Safety and Environmental Enforcement via Flickr.

Global oil prices have further improved riding on hopes of a new Covid-19 related stimulus package from the US to support the local industry.

The oil market also received support from rising crude demand in the Asian markets.

Brent crude climbed 22 cents to $45.21 per barrel while the West Texas Intermediate US crude increased by 32 cents to trade at $42.26 a barrel, reported Reuters.

US President Donald Trump tweeted that top Democrat leaders want to meet him for the relief package. Earlier, the talks stalled over disagreements between the US government and opposition.

ANZ was quoted by the news agency as saying in a note: “Crude oil gained amid signs of further stimulus measures.

“US lawmakers continued negotiations on the massive virus relief economic package with Treasury Secretary Steven Mnuchin saying there are areas where compromise is possible and a fair deal could be agreed upon. Sentiment was also boosted by comments from Saudi Aramco that demand is improving.”

The oil prices also received support after Saudi Aramco CEO Amin Nasser said that oil demand is gradually recovering as several Asian economies withdraw Covid-19 related restrictions.

A weaker US currency also supported the market after the US dollar slipped by 0.1% against a group of other currencies.

On the other hand, passenger aviation in the US is showing signs of recovery, as the airline traffic doubled in June from the levels seen in May. However, the figure is still 80% down from the levels registered a year ago.