Oil holds near year-long highs as COVID-19 lockdowns seen easing

By Laura Sanicola NEW YORK (Reuters) - Oil prices were steady on Tuesday, trading close to more than year-long highs on signs that global coronavirus restrictions were being eased although concerns about the pace of a U.S. economic recovery and the return of Texas oil production kept gains in check

Reuters February 24, 2021 01:06:25 IST
Oil holds near year-long highs as COVID-19 lockdowns seen easing

COVID-19 lockdowns seen easing" src="https://images.firstpost.com/wp-content/uploads/reuters/02-2021/24/2021-02-23T163529Z_2_LYNXMPEH1M0CU_RTROPTP_2_GLOBAL-OIL.jpg" alt="Oil holds near yearlong highs as COVID19 lockdowns seen easing" width="300" height="225" />

By Laura Sanicola

NEW YORK (Reuters) - Oil prices were steady on Tuesday, trading close to more than year-long highs on signs that global coronavirus restrictions were being eased although concerns about the pace of a U.S. economic recovery and the return of Texas oil production kept gains in check.

Brent crude rose 9 cents to $65.33 a barrel by 1:56 p.m. EST (1856 GMT), still close to its highest levels since January 2020. U.S. crude fell 13 cents, or 0.2%, to $61.57 a barrel.

Both contracts rose more than $1 earlier before retreating.

Shale oil producers and refiners in the southern United States are slowly resuming production after 2 million barrels per day (bpd) of crude output and nearly 20% of U.S. refining capacity shut down because of last week's winter storm.

Traffic at the Houston ship channel was slowly returning to normal. Production, however, was not expected to fully restart soon and some shale producers forecast lower oil output in the first quarter.

After the cold snap, U.S. crude oil stockpiles were also seen falling for a fifth straight week, while refined products' inventories also declined last week, an extended Reuters poll showed.

"The freeze off is still supporting prices to a degree but there's a lid because of how quickly supply will come back," said John Kilduff, partner at Again Capital LLC.

There were also concerns over the U.S. economic recovery, which the chair of the Federal Reserve, Jerome Powell, said remained "uneven and far from complete." He said it would be "some time" before the central bank considered changing policies it had adopted to help the country back to full employment.

Commerzbank analyst Eugen Weinberg said the recent oil price rise was buoyed by upbeat price forecasts from U.S. brokers.

Goldman Sachs expects Brent prices to reach $70 per barrel in the second quarter from the $60 it predicted previously, and $75 in the third quarter from $65 forecast earlier.

Morgan Stanley, which expects Brent to reach $70 in the third quarter, said new COVID-19 cases were falling while "mobility statistics are bottoming out and are starting to improve".

Bank of America said Brent prices could temporarily spike to $70 in the second quarter.

(Reporting by Laura Sanicola in New York; Additional reporting by Bozorgmehr Sharafedin in London and Jessica Jaganathan in Singapore; Editing by Marguerita Choy and Matthew Lewis)

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

Updated Date:

TAGS:

Subscribe to Moneycontrol Pro at ₹499 for the first year. Use code PRO499. Limited period offer. *T&C apply

also read

Citigroup considering divestiture of some foreign consumer units - Bloomberg Law
Business

Citigroup considering divestiture of some foreign consumer units - Bloomberg Law

(Reuters) - Citigroup Inc is considering divesting some international consumer units, Bloomberg Law reported on Friday, citing people familiar with the matter. The discussions are around divesting units across retail banking in the Asia-Pacific region, the report https://bit.ly/3pD57WP said

Biden tours Pfizer vaccine plant as drugmaker promises to double supply
World

Biden tours Pfizer vaccine plant as drugmaker promises to double supply

By Alexandra Alper and Michael Erman PORTAGE, Mich. (Reuters) - U.S

Google to evaluate executive performance on diversity, inclusion
Business

Google to evaluate executive performance on diversity, inclusion

By Paresh Dave (Reuters) - Alphabet Inc's Google will evaluate the performance of its vice presidents and above on team diversity and inclusion starting this year, the company said on Friday in one of several responses to concerns about its treatment of a Black scientist.