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

By Bozorgmehr Sharafedin LONDON (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 kept gains in check

Reuters February 24, 2021 00:06:52 IST
Oil holds near year-long highs as COVID lockdowns seen easing

Oil holds near yearlong highs as COVID lockdowns seen easing

By Bozorgmehr Sharafedin

LONDON (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 kept gains in check.

Brent crude was up 7 cents, or 0.1%, at $65.31 a barrel by 1505 GMT, still close to its highest levels since January 2020. U.S. crude fell 14 cents, or 0.2%, to $61.56 a barrel.

Both contracts rose more than $1 earlier before retreating.

"Vaccine news is helping oil, as the likely removal of mobility restrictions over the coming months on the back of vaccine rollouts should further boost the oil demand and price recovery," UBS oil analyst Giovanni Staunovo said.

But, tempering the upbeat mood, the chair of the U.S. Federal Reserve, Jerome Powell, said the U.S. economic recovery remained "uneven and far from complete" and 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 per barrel in the second quarter.

In the United States, traffic at the Houston ship channel was slowly returning to normal after last week's winter storm, although production was not expected to fully restart soon.

Some U.S. shale producers forecast lower oil output in the first quarter.

Stockpiles of U.S. crude oil and refined products likely declined last week, a preliminary Reuters poll showed on Monday, due to the disruption in Texas.

(Reporting by Bozorgmehr Sharafedin in London, additional reporting by Jessica Jaganathan in Singapore; Editing by David Evans and Edmund Blair)

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

Updated Date:

TAGS:

also read

France, Germany to agree to NATO role against Islamic State - sources
| Reuters
World

France, Germany to agree to NATO role against Islamic State - sources | Reuters

By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States

China's Xi says navy should become world class
| Reuters
World

China's Xi says navy should become world class | Reuters

BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.