Oil prices recorded a limited drop on Friday with investor concerns over the speed of oil demand recovery amid confusing news about the effectiveness of COVID-19 vaccines.
International benchmark Brent crude was trading at $69.15 per barrel at 0658 GMT for a 0.69% decrease after closing Thursday at $69.63 a barrel.
American benchmark West Texas Intermediate (WTI) was at $65.51 per barrel at the same time for a 0.77% drop after it ended the previous session at $66.02 a barrel.
Oil prices skyrocketed after the OPEC+ decision to keep the current production levels, as well as from tensions between Saudi Arabia and Yemen on Monday, which resulted in Brent briefly hitting over $71 a barrel.
On Wednesday, US Energy Information Administration (EIA) said the country’s gasoline stocks showed a significant drop, falling 11.9 million barrels, or 4.9% to 231.6 million barrels, which signals demand recovery before the start of the driving season.
However, the speed of actual demand recovery, based on vaccination rates and the degree to which travel and employment conditions return to pre-COVID levels are still uncertain. However, OPEC forecasted better demand in the second half of the year in its monthly report released Thursday.
Uncertainties over the efficacy of the current vaccines have escalated after health authorities in some European countries, including Denmark, Norway and Iceland, banned the COVID-19 vaccine developed by AstraZeneca and Oxford University amid reports of severe or fatal blood clots in vaccinated people.
Further declines were limited as US President Joe Biden finally signed the $1.9 trillion coronavirus relief bill into law.
The package will see most Americans receive $1,400 direct payments, expand the child tax credit up to $3,600, and boost funds for state and local government reeling from the coronavirus pandemic.
The American Rescue Plan, as the bill is formally known, will also increase food assistance programs through September and will help low-income households pay for rent.
By Sibel Morrow