EghtesadOnline: Oil prices edged higher on Tuesday on positive news on vaccine trials, but are still within the narrow trading band of the past three weeks amid fears that new lockdowns could derail a recovery in demand.
Brent futures were up 21 cents, or 0.5%, at $43.49, while West Texas Intermediate gained 11 cents to $40.92, CNBC reported. The closing prices of both Brent and WTI have traded within a $2 channel so far this month.
Prices were supported by promising vaccine developments as drug makers and medical institutions rush to find a way to counter the world’s worst health crisis in a century.
In China, some cinemas reopened on Monday after a six-month closure, raising hope a recovery from the pandemic is holding in the world’s second-largest economy, where the outbreak first started.
Analysts, however, cautioned about the fragile nature of the oil market, raising concerns that strong demand from China could dry up in coming months.
“Despite the calm, oil markets also remain in some degree of distress, with China importing way more crude than its refineries can process,” Eurasiagroup , a political risk consultancy founded in 1998, said in a note.
Meanwhile, countries from the United States to India are posting record numbers of infections, while some nations such as Spain and Australia are battling renewed outbreaks.