Oil futures rose Tuesday, with Brent crude pushing further above $50 a barrel, as investors cheered the rollout of a COVID-19 vaccine and tracked progress in Washington toward another round of economic relief.
West Texas Intermediate crude for January delivery CL.1, +0.32% CLF21, +0.32% rose 27 cents, or 0.6%, to $47.25 a barrel on the New York Mercantile Exchange. February Brent crude BRN00, +0.22% BRNG21, +0.22%, the global benchmark, was up 27 cents, or 0.5%, at $50.56 a barrel on ICE Futures Europe. Both benchmarks closed Monday at their highest levels since early March.
Oil, meanwhile, has been defying negative news, said Eugen Weinberg, commodity analyst at Commerzbank.
“More and more countries in Europe and states in the U.S. are tightening the corona restrictions over Christmas and the new year, which is likely to weigh on demand for oil,” he said, in a note. “OPEC already took account of this in its monthly report yesterday, downwardly revising its forecast for global oil demand in the first quarter of 2021 by around 1 million barrels per day/”
The International Energy Agency on Tuesday warned that the economic recovery in some of the world’s wealthier countries was “going backwards” this quarter. In its monthly oil market report, the IEA cut its forecast for a 2021 recovery in demand by 170,000 barrels a day to 5.7 million barrels a day.
Efforts toward another round of pandemic financial relief were also ongoing in Washington.
A bipartisan group of House and Senate lawmakers on Monday proposed a two-part package that would separate the most contentious issues holding up approval from a $748 billion package that includes widely supported measures, including extended unemployment benefits and aid to business. Thornier issues, including liability protections for businesses and aid to state, local and tribal governments were put into a proposed $160 billion package.