Economy

Oil prices up over bullish sentiment on vaccines

Large build in US crude oil inventories block further rise amid ongoing weak global demand

Sibel Morrow   | 10.12.2020
Oil prices up over bullish sentiment on vaccines

ANKARA

Crude oil prices increased on Thursday on bullish sentiments over the COVID-19 vaccine, as the UK has already started shots and the US is awaiting approval, while a massive build in US oil stocks capped further price rises.

International benchmark Brent crude was trading at $49.01 per barrel at 0632 GMT for a 0.31% increase after closing Wednesday at $48.86 a barrel.

American benchmark West Texas Intermediate (WTI) was at $45.70 per barrel at the same time for a 0.39% rise after it ended the previous session at $45.52 a barrel.

Although economies and oil demand have weakened with the surge in coronavirus cases worldwide along with containment measures, markets are focusing on any positive news from the vaccines.

After the UK kicked off the first vaccine shots from US drugmaker Pfizer and its German partner BioNTech, the US Food and Drug Administration approval is on the way, as the country struggles with a high number of cases and deaths.

According to data from Johns Hopkins University on Thursday, the number of cases worldwide has now reached over 68.9 million. The US, the world's largest oil-consuming country, still tops the number of cases above 15.3 million, while cases in India now total over 9.7 million, and Brazil follows with over 6.7 million cases.

Further adding to price increases, the ongoing violence amid Iraq protests over deteriorating economic conditions claimed eight lives since Dec. 7.

Iraq’s Kurdish Regional Government has been struggling to pay the salaries of civil servants since April when the central government in Baghdad stopped payments following disputes over oil wealth management, revenue distribution, as well as disagreement over revenues from border crossings.

However, a strong rise in US crude oil inventories capped further price upticks.

According to data released by the country's Energy Information Administration (EIA) on Thursday, US commercial crude oil inventories rose by 15.2 million barrels, or 3.1%, to 503.2 million barrels relative to the market expectation of a fall of 1.5 million barrels.

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