By Jeph Ajobaju, Chief Copy Editor
Brent crude price rose 0.46 per cent on Wednesday to $62.99 per barrel (bp), reversing four days of losses on fears of over supply by OPEC+ that were an aberration to the overall 15 per cent price gains in February.
Oil prices rose for a fourth straight month in February, despite their heavy plunge at the last trading session of the month, February 26.
Brent crude, the international benchmark for oil, settled at $64.42 pb, down 3.7 per cent on February 26.
But it rallied up 2.5 per cent in the entire final week, and 15 per cent in the entire month, extending gains in January, in December (9 per cent), and November (27 per cent).
On Wednesday, crude oil prices recorded early gains at the third trading session of the week. Oil traders are riding on high hopes on progress made by COVID-19 vaccine rollouts in the United States, the world’s largest economy.
Early in the day, US West Texas Intermediate (WTI) crude futures gained 0.3 per cent to trade at $59.93 pb, partly recovering from the week’s losses.
Also the British-based oil contract, Brent crude, surged 0.46 per cent to trade at $62.99 pb, up from four days of losses.
However, the bulls may not yet be in full control as recent price action suggested capped gains.
Oil pundits anticipate energy demand recovery is on the right track partly to the successful rollouts of COVID-19 vaccines at emerged markets.
Stephen Innes, Chief Global Market Strategist at Axi, in a note to Nairametrics spoke on the rising oil stockpiles in the US, keeping oil bulls far from holding their grip.
Said he: “US oil stockpiles rose last week and product inventories fell sharply in a cause and effect of the cold snap that forced refiners to shut down Texas operations.
“The unexpectedly large crude inventories build hit at a worrying time for oil bulls.
“This is particularly significant on the rising possibility that OPEC major oil producers could agree to ease production cuts at a critical meeting this week amid concerns that demand will likely outstrip supply as the global vaccine-led recovery gathers a head of steam.”
Oil traders are anxiously waiting for the meeting of OPEC+ on February 4, a sign of caution as the market continues to draw straws and gauges likely rise in production.