Oil prices continued on the march Wednesday, rising for a fourth straight day and shrugging off an industry report showing a higher-than-unexpected rise in U.S. crude stockpiles and extending a rally driven by hopes that a Covid-19 vaccine will boost fuel demand.
Brent crude was up 35 cents, or 0.7%, at $48.17 U.S. a barrel mid-morning Wednesday, having risen almost 4% in the previous session. West Texas Intermediate crude gained 28 cents, or 0.6%, to $45.20 U.S. a barrel, after rising more than 4% on Tuesday.
Both contracts are at their highest since early March and have rallied nearly 10% in the last four days.
At least three companies have been touting their newest vaccine candidates, AstraZeneca said on Monday its Covid-19 vaccine was 70% effective in trials and could be up to 90% effective, providing another weapon in the fight to control the pandemic.
However, researchers caution, any viable vaccine is not likely to be ready for mass use in the next few months, meaning lockdowns and travel restrictions will be in place into next year.
That makes it likely that OPEC+, which groups the Organization of the Petroleum Export Countries (OPEC) and allies including Russia, will continue production cuts into 2021 after a meeting set to start on Nov. 30 following technical talks this week.
OPEC+ producers have been withholding supplies to support prices after pandemic lockdowns earlier this year caused an evaporation in demand.
They are currently due to increase production by two million barrels per day – about 2% of global demand before the pandemic – from January.