Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Crude Oil Higher as U.S. Growth Prompts Confidence

Published 04/29/2021, 09:43 AM
Updated 04/29/2021, 09:44 AM
© Reuters.

© Reuters.

By Peter Nurse   

Investing.com -- Crude oil prices traded higher Thursday, climbing to their highest levels in seven weeks, boosted by further signs of a global economic recovery, particularly in the U.S., the world's largest consumer of oil.

By 9:45 AM ET (1445 GMT), U.S. crude futures traded 2% higher at $65.14 a barrel, while the international benchmark Brent contract rose 2% to $68.12.

U.S. Gasoline RBOB Futures were up 1.5% at $2.1069 a gallon.

The U.S. economy strengthened in the first quarter of 2021 at a faster rate than expected, as Covid-19-related lockdowns started to ease. Gross domestic product grew at an annualized rate of 6.4% in the first quarter, up from 4.3% in the fourth quarter of 2020 and faster than consensus forecasts of 6.1%.

This report detailed the strongest first quarter growth since 1984, with total economic output now less than 1% below the pre-pandemic GDP peak.

A separate report from the Labor Department showed that another 553,000 Americans filed first-time jobless claims last week, a pandemic-era low.

With China's economy growing at a record 18.3% in the first quarter compared with last year and Germany’s government recently raising its growth forecast for Europe's largest economy to 3.5% from 3%, optimism is steadily growing that  global oil demand can climb back to pre-pandemic levels in a short time.

Earlier this week technical experts from the Organization of Petroleum Exporting Countries saw demand climbing by 6 million barrels a day this year, while influential investment bank Goldman Sachs (NYSE:GS) expects global oil demand to realize the biggest jump ever over the next six months, as prices climb to around $80 a barrel.

Sentiment in the sector has also been helped by Europe's major energy companies reporting big increases in first-quarter earnings, putting the worst of the pandemic-driven slump in fuel demand behind them.

With benchmark oil prices recovering from an April 2020 low of $16 a barrel, most of the companies managed to drive profits back above levels seen before the coronavirus pandemic first struck.

Adding to the good news, the weekly EIA report showed some continued positive signals when it comes to U.S. demand, with refinery utilization at the highest level since March of last year.

“Refined products consumption also improved, with implied demand for total products increasing by 1.63MMbbls/d, leaving demand at the highest level since mid-February,” ING analysts said, in a note.

The one fly in the ointment is the increase in Covid cases in parts of the world that haven’t instituted successful vaccination programs, particularly in India.

“While demand appears to be trending in the right direction in the US, there are still clear concerns over the impact that the surge in Covid-19 cases in India is having on fuel demand,” ING added.

 

Latest comments

all good news!
Hello
preliminary digital growth excited oil gamblers.
And here is what happens
good afternoon sirs ,at the time that published this document the wti gets down almost 1% ,i can't understand higher after 09:00gmt goes up ,any suggestions so we can look forward for the wti movements ?i am a beginner i read a lot but i confused !
And here how to do.I could not understand
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.