Brent crude settled up at US$62.43/barrel by 1:32 1832 GMT, after rising to a session high of US$62.83, the highest since 22nd January 2020. The US benchmark WTI ended the session at $59.47 after rising to a session high of US$59.82, the highest since 9th January 2020.
While Brent rose 5.3%, WTI notched a weekly gain of about 4.7%. The rally was in anticipation of the US President Joe Biden meeting with a bipartisan group of mayors and governors as he keeps pushing for approval of a US$1.9 trillion coronavirus relief plan to bolster economic growth and help millions of unemployed workers.
Oil prices have risen in recent weeks due to production cuts from the Organization of the Petroleum Exporting Countries (OPEC) and allied producers in the group OPEC+.
Oil prices held onto their recent gains this week, buoyed by further signs that crude stocks, particularly in the US were falling.
Analysts anticipate that inventories will fall further later this year as transport fuel demand revives in tandem with the easing of virus-related restrictions on travel.
Still, OPEC this week ratcheted down expectations for global oil demand to recover in 2021, trimming its forecast to 5.79 million bpd.
The International Energy Agency (IEA) said oil supply was still outstripping global demand, though COVID-19 vaccines are expected to support a demand recovery.
The (IEA) report paints a more pessimistic picture than market participants have presumably been envisaging given the current high prices.
Demand data from the world’s biggest oil importer also paints a bleak picture.
The number of people who travelled in China ahead of Lunar New Year holidays plummeted by 70% from two years ago as coronavirus restrictions curbed the world’s largest annual domestic migration, official data showed.
The US drillers this week added oil and natural gas rigs for a 12th week in a row, the longest streak of additions since June 2017.
According to secondary sources, OPEC crude oil production averaged 25.50 million bpd in January 2021, up 180,000 bpd from December 2020, with output rising in top producer Saudi Arabia, as well as in Venezuela and Iran, which are exempt from the OPEC+ cuts.
