Brent Crude Hits $51.53/Barrel after U.S Stockpiles Drop
Brent crude hits $51.53 per barrel after a significant fall in the United States stockpiles.
The global prices of oil hit a nine-month high on Thursday after government data showed a fall in inventories in the States last week.
It was however noted that progress towards a U.S. fiscal stimulus deal and strong Asian demand also buoyed prices.
Brent crude futures rose 45 cents, or 0.9 per cent, to $51.53 a barrel at 0436 GMT, while U.S. West Texas Intermediate (WTI) crude futures rose by 46 cents, or nearly one per cent, to $48.28 a barrel.
Both benchmarks hit their highest since early March.
“All the headlines have been bullish for oil prices,’’ said Edward Moya, senior market analyst at OANDA in New York.
“U.S. stockpiles posted a larger-than-expected draw, three of India’s refiners are operating almost at 100 per cent capacity, indicating crude demand remains strong.
“And it seems the U.S. will continue to deliver a more monetary and fiscal stimulus, sending the dollar lower and most commodities higher.’’
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U.S. crude inventories fell by 3.1 million barrels in the week to Dec. 11, the Energy Information Administration said, more than analysts’ expectations of a 1.9-million-barrel drop.
Also boosting oil prices, U.S. lawmakers edged closer to the agreement on a $900 billion virus-relief spending package on Wednesday with top Democrats and Republicans sounding more positive than they have in months about getting something done.
The U.S. on Thursday also expanded its campaign to deliver COVID-19 vaccine shots into the arms of doctors and nurses on the frontlines of a pandemic that has killed more than 2,500 Americans a day.
“The last full trading week of the year has been very bullish for crude prices as energy traders focus more on the light at the end of the COVID-19 tunnel and as Asian demand remains strong,’’ Moya added.
Further buoying bullish oil prices, US legislators agreed to break the $908 billion stimulus package into two different proposals, making it easier to negotiate a partial agreement needed to fund small companies, jobless benefits and the delivery of vaccines.
On the other hand, lingering demand fears continue to cap prices with the growing number of coronavirus cases, as countries impose tighter restrictions and lockdowns, including over the Christmas holiday.
According to data from Johns Hopkins University on Thursday, the number of cases worldwide has now reached over 74.2 million.
The US, the world’s largest oil-consuming country, still tops the number of cases above 16.9 million, while in India cases have reached over 9.9 million, and Brazil follows with over 7 million.
However, a vaccine rollout in the US has started and the country decided to expand its campaign to deliver COVID-19 vaccine shots for doctors and nurses.
Brent Crude Hits $51.53/Barrel after U.S Stockpiles Drop
