Oil prices increased on Friday over the optimism about a sooner economic and oil demand rebound as investors are optimistic that the wider use of the vaccines will put a brake on the pace of the pandemic, which will pave the way for a strong oil demand.
International benchmark Brent crude was trading at $71.35 per barrel at 06.09 GMT for a 0.05% gain after closing Friday at $71.31 a barrel.
American benchmark West Texas Intermediate (WTI) was trading at $68.87 a barrel at the same time with a 0.08% increase after ending the previous session at $68.81 per barrel.
Oil prices have been on an upward trend since last week and WTI reached 2-year-high levels as the investors were hopeful that the oil demand will continue rising ahead of the summer driving season.
The disciplined production policies of the major oil producing countries also contribute to the stability of the market as OPEC+ group agreed to implement their previously-agreed output quota to incrementally increase production until the end of July.
While a rising output at a time when the market needs less barrels in line with pandemic-hit demand, the optimistic discipline of the group and their expectation for a higher oil demand during the second half of the year are encouraging the investors.
Another positive stimulus for the oil markets is the pace of the vaccination campaigns which are expected to get wider after the World Health Organization announced on Monday that it validated the Chinese COVID-19 vaccine for emergency use, “giving countries, funders, procuring agencies and communities the assurance that it meets international standards for safety, efficacy and manufacturing.”
Adding more on the optimism for a rising oil demand, US crude stocks fell by more than the market expectation last week.
US commercial crude oil inventories fell by 5.1 million barrels, or 1%, to 479.3 million barrels, relative to the market expectation of a fall of 2.1 million barrels, according to data released by the country's Energy Information Administration (EIA) on Wednesday.
By Sibel Morrow