News: Oil rises on positive forecasts, slow U.S. output restart.
LONDON (Reuters) – Oil prices rose Tuesday, driven by the likely easing of global COVID-19 lockdowns, positive economic outlooks and lower production as U.S. shipments returned slowly after a freeze in Texas.
Brent crude rose 87 cents, or 1.3%, to $ 66.11 a barrel by 0945 GMT, and U.S. crude rose 68 cents, or 1.1%, to $ 62.38 a barrel.
“Vaccine news is helping oil as the likely lifting of mobility restrictions in the coming months due to vaccine launches should further fuel oil demand and price rally,” said UBS oil analyst Giovanni Staunovo.
Commerzbank analyst Eugen Weinberg said the very optimistic oil price forecasts by leading US brokers had also contributed to the recent price hike.
Goldman Sachs expects Brent prices to hit $ 70 a barrel in the second quarter (previously forecasted $ 60) and $ 75 in the third quarter (previously $ 65).
Morgan Stanley expects Brent crude oil prices to climb to $ 70 a barrel in the third quarter.
“New COVID-19 cases are declining rapidly around the world, mobility stats are bottoming out and starting to improve. Refineries in non-OECD countries are already running as hard as they were before COVID-19,” Morgan Stanley said in a note.
Disruptions in Texas caused by last week’s winter storm also supported oil prices. Some US shale producers are forecasting lower oil production in the first quarter.
US crude oil and refined product inventories likely fell last week, a preliminary Reuters poll revealed on Monday.
A weaker dollar also supported oil as crude oil prices tended to move in the opposite direction to the US currency.
Reporting by Bozorgmehr Sharafedin in London, additional reporting by Jessica Jaganathan in Singapore; Adaptation by David Evans
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