Oil prices have edged higher as investors witnessed a recovery in fuel demand following successful coronavirus (Covid-19) vaccine trials.
Prices were also supported by expectations that the Organization of the Petroleum Exporting Countries (OPEC), and allies, including Russia, together known as OPEC+, might ‘extend a deal to restrain output’.
Brent crude futures rose by $0.94 to reach $45.90 a barrel while US West Texas Intermediate (WTI) futures were up by $0.76 to touch $43.18, Reuters reported.
Both the Brent and the WTI benchmarks gained 5% last week.
Demand outlook has improved with news on progression towards Covid-19 vaccines development.
According to a US official, first vaccine injections in the US could start within a day or two after securing regulatory approval.
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On 23 November, British drug-making firm AstraZeneca said that its vaccine, developed in partnership with the University of Oxford, could be more than 90% effective under a single dosing regimen.
PVM analyst Stephen Brennock stated the news was ‘detaching sentiment’ from ‘gloomy fundamentals’.
He added: “Investors are ignoring near-term headwinds, chief among which are surging global Covid infections, and instead of looking ahead to next summer.”
On the supply front, OPEC+ will discuss its ‘output policy’ during the ministers meet on 30 November and 1 December.
Meanwhile, Yemen’s Houthi group said it fired a missile that struck a Saudi Aramco oil company distribution station in Jeddah, Saudi Arabia.
However, there was ‘no immediate Saudi confirmation of the claim’, said Reuters.