Oil gains 2% on potential OPEC+ rethink and vaccine hopes

By Devika Krishna Kumar NEW YORK (Reuters) - Oil prices firmed by about 2% on Wednesday on hopes OPEC and its allies will delay a planned increase in oil output and after Pfizer said its COVID-19 vaccine was more effective than previously reported. The market was also supported by a smaller-than-expected increase in U.S. crude stockpiles last week

Reuters November 19, 2020 00:08:57 IST
Oil gains 2% on potential OPEC+ rethink and vaccine hopes

Oil gains 2 on potential OPEC rethink and vaccine hopes

By Devika Krishna Kumar

NEW YORK (Reuters) - Oil prices firmed by about 2% on Wednesday on hopes OPEC and its allies will delay a planned increase in oil output and after Pfizer said its COVID-19 vaccine was more effective than previously reported.

The market was also supported by a smaller-than-expected increase in U.S. crude stockpiles last week.

Brent crude rose 93 cents, or 2.1%, to $44.68 a barrel by 12:47 p.m. ET (1747 GMT,) while U.S. West Texas Intermediate crude gained 65 cents, or 1.6%, to $42.08.

Both contracts jumped by about $1 after Pfizer Inc said that final results from late-stage trial of its vaccine showed it was 95% effective. Last week it had put the efficacy at more than 90%.

Moderna Inc on Monday said that preliminary data for its vaccine also showed it was almost 95% effective.

"Oil prices today are modestly rising on hopes that OPEC+ will decide to postpone its planned production increase in January and on the latest vaccine euphoria," said Rystad Energy's head of oil markets, Bjornar Tonhaugen.

To tackle weaker energy demand amid a second wave of the pandemic, Saudi Arabia called on fellow members of the OPEC+ group to be flexible to meet market needs and to be ready to adjust their agreement on output cuts.

OPEC+, comprising the Organization of the Petroleum Exporting Countries, Russia and other producers, met on Tuesday but made no formal recommendation. The group is due to discuss policy at a full ministerial meeting to be held on Nov. 30 and Dec. 1.

Members of OPEC+ are leaning towards delaying the current plan to boost output in January by 2 million barrels per day (bpd), sources have said. They are considering a possible delay of three or six months.

In the United States, crude inventories rose 768,000 barrels last week, compared with analyst expectations in a Reuters poll for a 1.7 million-barrel rise. Distillate stockpiles, which include diesel and heating oil, fell by 5.2 million barrels, far exceeding expectations.

"There's concern about gasoline demand, but overall inventories, including diesel stocks, fell, giving credence to the efforts of OPEC+ and reduced overall crude production," said Tony Headrick, energy markets analyst at CHS Hedging.

(Additional reporting by Ahmad Ghaddar in London, Yuka Obayashi in Tokyo; Editing by David Goodman and Marguerita Choy)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.

also read

Wall Street climbs on Cisco, Disney's upbeat results
Business

Wall Street climbs on Cisco, Disney's upbeat results

By Medha Singh and Shivani Kumaresan (Reuters) - Wall Street gained on Friday as Disney and Cisco's upbeat results brought the focus back to corporate earnings at the end of a volatile trading week that saw record surges in coronavirus cases and increased hopes of a working vaccine.

Gold jumps 1% on mounting pandemic, vaccine worries
Business

Gold jumps 1% on mounting pandemic, vaccine worries

By Sumita Layek (Reuters) - Gold gained as much as 1.1% on Friday as rising global coronavirus infections re-ignited concerns about the economic toll from the pandemic, while scepticism over the reach of a potential COVID-19 vaccine further boosted the safe-haven metal. Spot gold rose 0.8% to $1,890.81 per ounce by 11:33 a.m