Oil surged on Thursday rising above $50 to as much $51.07 per barrel for the first time since early March amid hopes of a faster demand recovery following the release of COVID-19 vaccines.
The rise is despite the U.S huge inventory data released on Wednesday showed a 15.2 million-barrel rise in crude stocks. Analysts had expected a 1.4 million-barrel drop.
On Tuesday, the United Kingdom began vaccinations and they could start as soon as this weekend in the United States. Canada on Wednesday approved its first vaccine and said initial shots would be delivered starting next week.
Oil has recovered from historic lows reached in April when the pandemic hammered demand, helped by a record supply-cut deal by the Organization of the Petroleum Exporting Countries and allies, known as OPEC+.
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Oil prices rose on Friday with Brent crude oil futures rising to just a shy of $50 per barrel as OPEC+ agreed to ease oil-output cuts next year after almost a week of negotiations.
The group in a meeting postponed by two days and additional delay on Thursday agreed to increase output slightly from January by 500,000 barrels per day with ministers hold monthly consultations to decide on the next steps.
Brent crude was up $1.71, or 3.64%, at $50.64 per barrel at 17:26GMT on Friday, U.S. West Texas Intermediate (WTI) crude rose $1.73 cents, or 3.80%, to $47.25 Nigerian banner oil, Bonny Light closed at $48.32 per barrel. .
“The latest set of data has exceeded any bearish expectations,” said Tamas Varga of oil broker PVM. “The stubbornness of oil bulls and their confidence in the positive economic impact of the vaccine roll-out are truly remarkable.”
Concern over an attack on an Iraqi oilfield also lent support. Two wells at a small field were set ablaze by explosives on Wednesday, but overall production from the field was not affected.
By: Ifunanya Ikueze
