Oil prices rose on Monday, pushing Brent back above $ 50 a barrel, supported by hopes that a coronavirus vaccine deployment will increase global demand for fuel as an oil tanker explosion in Saudi Arabia shook the nerves of the market.
Brent futures for February rose 60 cents, or 1.2 percent, to $ 50.57 a barrel at 12:00 GMT, while West Texas Intermediate U.S. crude futures for January rose of 54 cents, or 1.2 percent, to $ 47.11 a barrel.
Prices also increased gains amid supply nervousness after a shipping company said an oil tanker was hit by an external source while unloading at the port of Jeddah in Saudi Arabia.
“Brent is supported by both financial and physical flows. The dollar is falling, the Brent curve is downgrading and vaccines are being rolled out, ”said Bjarne Schieldrop, chief analyst at SEB.
“We think this rally must go further.”
Brent and WTI rallied for six straight weeks, their longest period of gains since June.
The United States has launched its COVID-19 vaccination campaign, giving hope that the pandemic restrictions could end soon and increase demand among the world’s largest oil consumer.
An extension of Brexit negotiations between European powers also supported financial markets on Monday.
Major European countries continued in lockdown mode to curb the spread of COVID-19 which has reduced demand for fuel. For example, Germany, the world’s fourth-largest economy, plans to impose a stricter lockdown from Wednesday to tackle the virus.
In the United States, energy companies added the most oil and gas rigs in a week since January last week, with producers continuing to return to the well.
Two separate fires occurred Sunday at the Qua Iboe crude oil export terminal in Nigeria and an oil pipeline in Iran, but the incidents were mostly contained.
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