30 Dec, 2020 - Oil advances on U.S. inventory draw, but demand fears weigh
Oil held steady on Wednesday as a U.S. coronavirus fiscal aid package and a decline in crude oil inventories supported prices.
Brent crude futures gained 0.49% to settle at $51.34 per barrel, and U.S. West Texas Intermediate (WTI) crude advanced 0.83% to settle at $48.40 per barrel.
Oil prices could gain strength as vaccination programs around the world begin next year, allowing countries to relax restrictions on movement and business activity.
U.S. physical crude oil grades strengthened on Tuesday as the API reported a decline in stockpiles, dealers said.
Crude oil stocks fell by 4.8 million barrels last week to about 492.9 million barrels, exceeding analysts’ expectations in a Reuters poll for a draw of 2.6 million barrels, data from API showed.
In the short-term, concerns over coronavirus lockdowns are likely to cap gains.
A new variant of the virus in the United Kingdom has led to the reimposition of movement restrictions, hitting near-term demand and weighing on prices, while hospitalizations and infections have surged in parts of Europe and Africa.
31 Dec, 2020 - Oil tumbles 20% in 2020 amid unprecedented demand loss from Covid
Global crude prices advanced on Thursday, but lost more than a fifth of their value in volatile trade in 2020, as lockdowns to combat the novel coronavirus depressed economic activity and slammed fuel demand.
Still, Brent and U.S. crude benchmarks have more than doubled from April’s decade lows. The start of coronavirus vaccinations bolstered demand in the fourth quarter, and prices recovered to the highest in about 10 months.
On the last trading day of 2020, Brent fell 49 cents, or 1%, to $51.14 a barrel. U.S. West Texas Intermediate crude settled 12 cents, or 0.25%, higher at $48.52 per barrel. Brent was on track to fall 22.5% for the year, with WTI due to drop 21.4%.
Prices for 2020 bottomed in April as fuel demand collapsed due to the COVID-19 pandemic and a price war between oil giants Saudi Arabia and Russia. WTI plummeted to a record low negative-$40.32 per barrel, while Brent fell to $15.98 barrel, the lowest since 1999.
From there prices drifted higher and took off once vaccine optimism hit the market.
A monthly Reuters poll on Thursday showed oil prices are not expected to make much progress in 2021.
And the demand outlook for fuel still remains murky.
The next major oil price driver will come Monday as the Organization of the Petroleum Exporting Countries and allies including Russia, a group known as OPEC+, plan to debate boosting crude output from February.
Reference : CNBC
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