Due to reports of increased COVID-19 vaccination and a decline in crude oil inventories in the world’s largest fuel consumer, the United States, the outlook for global economic growth is strong, and oil prices rose slightly on Wednesday.
However, optimism about the negotiations between the United States and Iran and the imminent increase in supply from major oil producers limited the increase.
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At 0403 GMT, the June Brent crude oil futures price rose by 24 cents, or 0.4%, to $62.98 per barrel, while the US West Texas Intermediate May crude oil futures price rose by 20 cents, or 0.3%, to $62.98 per barrel. USD 59.53.
ANZ Bank analysts wrote in a report on Wednesday: “Optimism about the outlook for the global economy has stimulated sentiment in the crude oil market.”
Prices rose as data on Tuesday showed that US job vacancies rose to a two-year high in February, while hiring numbers rose. Previous data showed that the service industries in the United States and China have improved.
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The International Monetary Fund (IMF) said on Tuesday that public spending in the fight against COVID-19 is unprecedented and will bring global economic growth to 6% this year, a rate that has not been seen since the 1970s.
US President Joe Biden raised the COVID-19 vaccine eligibility target for all American adults to April 19, and optimism about the wider launch of the vaccine has also pushed up prices.
Three market sources said that as of the week of April 2, US crude oil inventories fell more than expected, while fuel inventories increased, citing data before the government data of the American Petroleum Institute (API) on Wednesday.
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The U.S. Energy Information Administration (EIA) said on Tuesday that it expects U.S. oil production to decrease by 270,000 barrels per day to 11.04 million barrels per day by 2021, a larger drop than its previous monthly forecast of 160,000 barrels per day.
Iran held what they called “constructive” talks with world powers on Tuesday and agreed to form a working group to discuss the possible revival of the 2015 nuclear agreement, which could lead to Washington lifting sanctions on Iran’s energy sector and increasing oil supplies.
After the Organization of the Petroleum Exporting Countries (OPEC) and its allies OPEC+ (OPEC+) agreed to gradually relax oil production cuts starting in May, oil prices fell earlier this week.
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Edward Moya, senior market analyst at OANDA, said: “Crude oil prices seem to have consolidated, because energy traders need to understand how the Organization of the Petroleum Exporting Countries (OPEC+) strictly implements its production increase plan, and whether the EU will be at the end of June. It was close to virus immunity before.”
(Reporting by Jessica Jaganathan; Editing by Christian Schmollinger)