Oil Prices Rise with Corona Limits

Tension over the influence of rising coronavirus cases in leading oil importer China capped the gains.

Brent crude futures were higher by 50 cents, or 0.65%, at $80.30 a barrel by 1035 GMT, counting to a 76-cent gain in the prior session.

U.S. West Texas Intermediate (WTI) crude futures climbed $1, or 1.31%, to $76.19 after rising 90 cents on Monday.

Oil prices have been buoyed by U.S. plans declared last week to buy up to 3 million barrels of oil for the Strategic Petroleum Reserve behind this year’s record release of 180 million barrels.

A softer dollar has also sustained prices, making oil more affordable for those holding other currencies.

OANDA analyst Edward Moya noted that obvious signs of increasing demand are required for prices to rise further.

Easing the Restrictions

While China has been loosening epidemic limitations, a surge in coronavirus cases has been bearish for oil markets because of apprehension over the country’s economic recovery, stated CMC Markets analyst Tina Teng.

Cities across the country have been running to add hospital beds and create fever-screening clinics amid rising international concern that Beijing’s decision to disassemble its stringent “zero-coronavirus” rule could result in deaths and virus mutations.

U.S. crude oil stocks should drop by nearly 200,000 barrels last week. In distinction, gasoline and distillates inventories should rise. Investors are awaiting reports from the American Petroleum Institute on Tuesday and the Energy Information Administration on Wednesday.