Oil price continues its march to a higher place, with Brent crude hitting $60 per barrel, the first time in 2021. This is its highest settlement since January last year.
The European contract is boosted by hopes of swift economic recovery as vaccines rollout continuously.
Similarly, US Secretary for Treasury Janet Yellen called for the approval of Biden’s $1.9 trillion stimulus proposal.
Yellen noted that the United States could revert to full employment by 2022 should the necessary support becomes present.
In the closing charts, Brent crude contract for April delivery stood at $60.07 per barrel, hiking by 0.8% for the day. It hit its peak of $60.19 per barrel at one point of the trading session.
The West Texas Intermediate followed suit and jumped by 1.2%. The American benchmark traded at $57.54 a barrel, also its highest settlement since January 2020.
Events in the previous week started to take a positive effect on Monday’s trading. This includes OPEC’s decision to keep production cuts in place.
The move is in support of crude prices in the longer-term amid the still growing daily infections in the majority of the world’s biggest economies.
Similarly, the organization’s de facto leader and the world’s largest exporter of crude, Saudi Arabia, will continue to adopt the 1 million production cuts through March.
The crude’s association with Russia now expects OECD stockpiles to return to their five-year average by the middle of the year.
This is a significant development especially considering the situation during the early onset of the pandemic.
It is during such time when inventories skyrocketed to historic highs amid the flagging global demand.
Crude Inventory Closely-monitored
The commodity traders are currently keeping a sharp eye on crude inventory reports in the mid-week.
Last week, both the American Petroleum Institute and the US Energy Information Administration reported significant improvement in stockpiles.
Another supportive factor that boosted sentiment is the passing of the budget resolution for the next stimulus measure on Friday.
The House of Representatives followed the Senate’s trail, igniting hopes for the approval of the monetary injection.
The decision is quick to buoy oil price in both contracts, ending last week with significant gains with $59 and $56 per barrel, respectively.
On the other hand, the biggest concern now lies in how other economic indicators will turn out.
The US labor market currently remains under pressure despite the better data on weekly jobless claims. This is due to the lukewarm job creation data in January.