Oil prices rose on Tuesday, helped by positive news about vaccine trials and an EU stimulus agreement reaching levels that were last seen when an oil price war broke out in early March between Russia and Saudi Arabia.
Benchmark, Brent crude rose $ 1.17 cents at $ 44.45 at 09.04 GMT, on track for the biggest daily gain since mid-June at around 2.7%. West Texas Intermediate (WTI) rose 19 cents to $ 41.00, the highest daily increase in a month of around 2.6%.
The prices were supported by an agreement among EU leaders on a 750 billion euro fund to prop up their economies choked by the coronavirus, raising the prospect of fuel demand. In other markets, world stocks and the euro also reached their strongest levels since March on Tuesday.
The agreement allows the European Commission to increase billions of euros in the capital markets on behalf of all 27 countries, an act of solidarity that has been unprecedented in nearly seven decades of European integration.
Oil prices are also supported by promising virus vaccine data released on Monday, increasing confidence that vaccines can be made even if global launches will take time. In China, cinemas reopened on Monday after a six-month closing, another sign of recovery in the world's second-largest economy.
Oil Prices Had Decline
Countries from the United States to India posted record numbers of infections, while several countries such as Spain and Australia fought against new outbreaks. In the first major energy deal since coronavirus destroyed demand for fuel, Chevron Corp said it would buy Noble Energy Inc. at a price of around $ 5 billion.
On Monday, oil prices got a boost from the acquisition of the corona virus vaccine data. This increased public confidence that the vaccine could be made and cure COVID-19 patients and could be launched globally.
Brent LCOc1 crude fell 24 cents, or 0.6%, at $ 42.90 a barrel at 09.43 GMT, while US West Texas Intermediate (WTI) CLc1 slipped 23 cents, or 0.6%, to $ 40.36.
The head of the Rystad Energy oil market, Bjornar Tonhaugen, said "as it has already happened, the price that has been set is not possible to produce a large enough profit in a short time, until this pandemic slows. And although in Europe the virus has been cornered, America and some Asian countries are still far away."
Reporting from Reuters, this pandemic has attacked more than 14.5 million new people globally and has claimed the lives of as many as 604,000 people, this pathogen is what causes this disease.
Oil Undergoes Recovery After Decline
Trading cues began with investors looking for a European Union summit, this was done with leaders showing the first signs of a compromise on carving a recovery fund of 750 billion euros ($ 858.30 billion) which became a proposal to revive the economy.
Japan's oil imports fell 14.7% in June from the same month a year earlier, official figures showed Monday. The decline was not as pronounced as in May when they fell 25%, year on year. Also underscoring the impact of the virus, Japan's exports dropped 26.2% in June from a year earlier, the finance ministry data showed on Monday.
While fuel demand has recovered from a 30% decline in April after countries around the world imposed strict locking, its use is still below pre-pandemic levels. Demand for US retail gasoline fell again due to increased infection.
In a note, JBC said, "We realize that improving further requests will be difficult to be achieved, but also not expecting returns to the lowest position of april and may."
Increased tensions between China and the United States also put pressure on prices. On Sunday, the Chinese embassy in Myanmar blamed the United States for "smearing" the country with extreme outrage, and encouraged Southeast Asian neighbors over the contested South China Sea and Hong Kong.
