Sign up here for GlobalData's free bi-weekly Covid-19 report on the latest information your industry needs to know.
Oil prices remain mixed after Brent dropped following an early gain, while US crude made gains amid signs of recovery in fuel demand and OPEC+ producers reducing output as committed.
According to Reuters, Brent crude fell by $0.19 to $34.62 a barrel at 0351 GMT. In the previous session, Brent touched the highest since 9 April.
Meanwhile, US West Texas Intermediate (WTI) crude increased $0.11 to $31.93 a barrel. In the earlier session, it rose as high as $33.44 a barrel, its highest since 16 March.
The June WTI contract is set to expire on 19 May, but there was slight sign of WTI repeating the historic crash below zero seen last month as prices gained on signs of recovery in fuel demand.
CMC Markets chief market strategist Michael McCarthy was quoted by the news agency as saying: “I would not be surprised to see a short-term pull back as strength that we’ve seen in crude market the last week was quite extraordinary.”
Earlier, the oil price market was boosted by signs that record output cuts agreed by the OPEC+ Group is being implemented.
Nissan Securities research general manager Hiroyuki Kikukawa said: “Investors’ sentiment has improved as OPEC+ are apparently slashing output as they promised for this month, with more voluntary cuts expected in June.
“At the same time, there is growing optimism that the easing of global (coronavirus) lockdowns will help boost economic activity and fuel demand.”
Oil prices also lifted amid signs of fall in the US production, with crude output from seven major shale formations expected to sink by a record 197,000 barrels per day (bpd) next month to 7.822 million bpd.
According to the industry group US Energy Information Administration (EIA), this would be the lowest since August 2018.