Oil rose in Asian morning commodities trade following encouraging news on U.S. President Donald Trump’s recovery from COVID-19. However, large drops toward the end of the previous week are yet to be seen.
Brent oil futures were up 2.09% to $40.09 while WTI futures soared 2.32% to $37.91.Brent crude has pulled back above the $40 mark after reaching its lowest level since June in the previous week.
WTI futures also recovered some of its losses in the charts . Though it has a way to go to return to parity with prices from before the previous Friday’s major slump.
The previous fall came on the back of news that President Trump tested positive for COVID-19.This morning’s rise in the energy commodity comes in response to encouraging news on the U.S. president’s health.
Avtar Sandu, senior commodities manager at Phillip Futures said he thinks it’s the improving health of the U.S. president. Over the weekend there were a lot of conflicting reports on his health, but generally he’s improving, he said.
A strike by Norwegian oil workers is another factor pushing oil higher. It may potentially reduce the country’s output by up to 330,000 barrels of oil equivalent per day. This was according to the Norwegian Oil and Gas Association.
The fighting that continues to intensify between Armenia and Azerbaijan in the Nagorno-Karabakh is also supporting oil prices. The Azerbaijan city of Ganja has come under artillery fire over the last two days.
OPEC+ to Consider Further Supply Cuts
Supply has increased from newly reopened Libyan oil facilities as well as exports from Iraq last month have also increased. When these supply increases are combined with export increases, they weigh on the markets.
Iraq was supposed to have reduced its exports. This was in line with promises made to OPEC that it would cut back on production. That was in order to compensate for previously overstepping its production quotas.
China’s crude imports have slowed, adding a further headwind to oil value. This was according to a note from J.P. Morgan analysts on Oct. 2.
This will likely force OPEC+ to consider further supply cuts at their November meeting.
Earlier in the previous week, the global death toll from the COVID-19 pandemic passed 1 million. Furthermore, case numbers have now passed 35 million as of Oct. 5. This data was according to Johns Hopkins University, further threatening global economic recovery.
Meanwhile in precious metals, gold was down on Monday morning in Asia. Investors have retreated from the safe-haven asset over news that President Trump could soon be discharged from the hospital.
Gold futures dropped 0.47% to $1,898.70 falling just below the $1,900-mark. Yellow metal gold looked set for its biggest weekly percentage boost since August on Friday. This followed Trump and his wife Melania Trump testing positive for the virus.
President Trump’s medical team sent confusing and contradictory updates over the weekend. But their latest statement, released on Sunday, said that Trump is recovering and could be discharged by Monday.
