Oil Sustains Bullish Run Above $65 Per Barrel

Brent crude oil holds above $65 per barrel on Wednesday during the Asian trading session after declining from $66.74 per barrel on Tuesday.

Brent oil pulled back from $66.74 per barrel attained on Tuesday to $65.26 per barrel as of 9:44 am Nigerian time as shown below.

The global benchmark for Nigerian oil rose to more than a year-high on Tuesday on signs that countries have started easing coronavirus restrictions and pharmaceutical companies are getting more efficient with vaccine distribution.

“Vaccine news is helping oil, as the likely removal of mobility restrictions over the coming months on the back of vaccine rollouts should further boost the oil demand and price recovery,” UBS oil analyst Giovanni Staunovo said.

Despite Goldman Sachs predicting $70 per barrel for Brent crude in the second quarter, $75 in the third quarter, the uncertainty surrounding the US economy, especially after the U.S. Federal Reserve Chairman, Jerome Powell, said the recovery in the world’s largest economy remained “uneven and far from complete”, keeps weighing on crude oil outlook.

According to Powell, it would take “some time” before the apex bank considers changing its present policies to help the country back to full employment.

Morgan Stanley, however, remained bullish and predicted $70 per barrel for crude oil in the third quarter of the year. The leading investment bank said new COVID-19 cases were falling while “mobility statistics are bottoming out and are starting to improve”.

This, it expects to further open up economies and stimulate crude oil demands in key markets.